New Jersey Supreme Court Rules Watchdog Employees Entitled to CEPA Protections
In a highly anticipated decision, the New Jersey Supreme Court recently upheld the right of employees who complain about illegal workplace activities to sue for wrongful retaliation even when the raising of such issues is a part of their designated job duties. Rejecting a plethora of past rulings by New Jersey’s intermediate appeals court, the Supreme Court in Lippman v. Ethicon, Inc., (NJ 2015), held that the Conscientious Employee Protection Act (“CEPA”) does not create any type of carve out for employees who are responsible for engaging in certain “watchdog” activities as part of their job responsibilities. What this now means for employers is that all employees, even those who may have responsibility in the workforce for ensuring compliance with certain legally required standards of care and reporting any deviations from those requirements, are covered by the statute and entitled to CEPA’s protections even when the employee’s whistleblowing activities pertain to aspects of those “watchdog” job responsibilities.
The plaintiff in Lippman was formerly employed as the world wide vice president of medical affairs and chief medical officer for the defendant. His job responsibilities included safety compliance over medical reviews of items being sold by his employer. On numerous occasions, plaintiff objected to the proposed and/or continued sale of certain products claiming that such products were unsafe or defective. Plaintiff’s employment was ultimately terminated, and Lippman claimed that his firing occurred in violation of CEPA due to those foregoing past complaints that Lippman claimed were protected whistleblowing activities.
Based upon the previously existing case law that exempted “watchdog” employees from the scope of CEPA’s whistleblowing protections where such complained of activities simply involved the employee performing his job obligations, the trial court dismissed plaintiff’s complaint. When the matter was subsequently appealed, the intermediate appeal court refused to follow this earlier case precedent, concluding in part that allowing “watchdog” whistleblowing claims was required by CEPA because such employees are in an extremely vulnerable position to suffer retaliation for doing their jobs. In ultimately agreeing with that appeal decision, the Supreme Court found no textual support for an exemption for “watchdog” employees, and broadly interpreted the scope of CEPA’s protections to eliminate what it concluded were the evils of retaliation as intended by the legislature in passing CEPA. While siding with the earlier appeal court ruling, the Supreme Court likewise thought that this ruling went too far in imposing a higher standard of proof in the form of a mandated internal whistleblowing reporting exhaustion requirement that the Court concluded went beyond the elements of proof ordinarily applied to CEPA claims.
With the Supreme Court’s expansive Lippman ruling that broadens the class of employees who are protected by CEPA to encompass all employees in one’s workforce, it is incumbent upon employers to make employment related decisions free of any type of retaliatory animus that could result in a CEPA claim against the company, even when those employees have taken adverse positions against the company (as Lippman did here) as part of his job obligations. No longer will employers have the benefit of what was at least some common law recognized limits on the kinds of employees statutorily protected by CEPA, which means that this can no longer be used as grounds for ignoring the pleas of a “watchdog” employee engaged in possible whistleblowing activities.
One final note: for employers who may not be aware, CEPA in addition to creating a possible ground for a wrongful discharge claim also requires that employers provide its workforce annually with individual notices advising employees about their whistleblowing rights under the CEPA statute. If your company is not in compliance with such notice requirements, which includes having a CEPA whistleblowing policy as part of your company employee handbook, you should take steps now to immediately remedy such issues and seek legal advice to answer any further CEPA compliance questions.