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Minnesota Supreme Court Refuses to Recognize Wrongful Discharge Claims for Employees Terminated Due to Seeking Unemployment Benefits

January 2014

On January 2, 2014, in Dukowitz v. Hannon Security Services, the Minnesota Supreme Court refused to allow employees to sue for wrongful discharge for terminations resulting from a decision to file for unemployment benefits.

In Dukowitz, the employee was hired as a security officer and assigned to an evening position which she maintained for approximately three years. In July of 2008 the employee expressed interest in and was offered a temporary daytime position. When accepting the position she signed an acknowledgment indicating the possibility that it would be unavailable beyond the holiday season. Not unexpectedly, in December of that same year the employee was told the daytime position would no longer be available at the end of the month and that there were no other hours available. The employee claimed she told her direct supervisor that she would need to apply for unemployment benefits. According to the employee, her supervisor then turned to another supervisor and asked if they should terminate her employment. Regardless, on December 21, 2008, due to forthcoming reduction in her work hours the employee applied for unemployment benefits. Approximately three months later, after working on a reduced floating schedule, her employment was terminated. Thereafter the employee brought a wrongful discharge in violation of public policy claim, alleging she was terminated in retaliation for applying for unemployment compensation benefits.

In finding for the employer the Minnesota Supreme Court discussed the familiar concept of employment-at-will and stated that Minnesota's unemployment compensation statutes provide no exception that would allow the employee to sue for retaliation for seeking unemployment benefits. Although the Court acknowledged past rulings indicating as a matter of public policy employees terminated for refusing to violate the law may bring a wrongful discharge claim, it concluded the employee's claim did "not come within this narrow exception." The Court also refused to expand the employment-at-will exception, preferring to maintain its very narrow scope.

Although the Court refused to allow the employee's claim to go forward in this matter does not mean that employers should feel free to terminate employees who decide to file for unemployment. Despite the favorable ruling, the Court provided a note of caution by reminding employers that employees may still bring an action under Minn. Stat. § 268.184, making it illegal for an employer to "directly or indirectly . . . obstruct[s] or impede[s] an application or continued request for unemployment benefits."

Employee terminations are not always straightforward and are the most likely action to lead to litigation. Although the employer in this case prevailed, it spent almost five years in litigation to get there. Employers that have any questions or concerns regarding the need terminate an employee should contact the knowledgeable attorneys at Wessels Sherman for guidance.