AB160: Bill Text

LRB-0896/2

GMM:eev&cjs:jf

2015 - 2016 LEGISLATURE

2015 Assembly BILL 160

April 8, 2015 - Introduced by Representatives Ohnstad, Hesselbein, Berceau, Bowen, Considine, Genrich, Goyke, Hebl, Johnson, Kessler, Milroy, Sargent, Sinicki, Subeck, C. Taylor, Young, Zamarripa and Zepnick, cosponsored by Senators Erpenbach, Wirch, Carpenter, Hansen and Harris Dodd. Referred to Committee on Labor.

AB160,1,2 An Act to amend 814.04 (intro.) and 893.43; and to create 103.11 and 893.995 of the statutes; relating to: wrongful discharge from employment.

Analysis by the Legislative Reference Bureau

Under current law, subject to certain exceptions, the employer-employee relationship is governed by the employment-at-will doctrine, under which an employer may discharge an employee "for good cause, for no cause, or even for a cause morally wrong, without being thereby guilty of a legal wrong." Hausman v. St. Croix Care Center, 214 Wis. 2d 655 (1997).

This bill prohibits an employer, including the state, from discharging an employee unfairly or for any wrongful reason, except that this prohibition does not apply to: 1) a discharge that the employee has chosen to contest under any other state or federal law that provides a procedure or remedy for contesting the discharge; 2) a discharge that is covered by a written collective bargaining agreement; 3) a discharge that is covered by a written contract of employment for a specific term; or 4) a discharge of an employee who any other state or federal law specifically provides is an employee at will or is to serve at the pleasure of a public official or other appointing authority.

The bill, however, does not preclude an employer from discharging an employee for a violation of a work rule or performance standard if the procedures used to discharge the employee are fair. Under the bill, a discharge of an employee for a violation of a work rule or performance standard is unfair if any of the following applies:

1. The work rule or performance standard was not made known to the employee prior to the discharge.

2. The employer failed to enforce the work rule or performance standard in similar situations for a prolonged period.

3. The employer did not conduct an interview with the employee, or hold a hearing, concerning the violation prior to the discharge, did not conduct that interview or hearing promptly after the violation, or did not provide the employee with a precise description of the conduct constituting the violation.

4. The employer did not prove by clear and convincing evidence that the employee committed the violation.

5. The violation is the same as or substantially similar to a violation committed by another employee who was not discharged for committing the same or a substantially similar violation.

6. Unless the violation is egregious, the employer failed to first apply a less drastic form of discipline for the violation.

7. The discharge is disproportionate to the gravity of the violation, taking into consideration any mitigating or aggravating circumstances.

Also, under the bill, a discharge is for a wrongful reason if: 1) the discharge was in retaliation for the employee's refusal to violate a public policy or reporting a violation of a public policy; 2) the employer violated the express provisions of its own written personnel policy; or 3) except during an employee's probationary period, the discharge was not for good cause, which is defined in the bill as reasonable, job-related grounds for dismissal based on a failure to satisfactorily perform job duties, disruption of the employer's operation, or any other legitimate business reason.

The bill permits an employee to bring an action in circuit court alleging a wrongful discharge committed by an employer in violation of the bill within one year after the date of the discharge and provides that in any such action the employer has the burden of proving by clear and convincing evidence that the employee was discharged fairly and not for a wrongful reason. If the court finds that an employer has committed a wrongful discharge, the court may award the employee lost wages and lost fringe benefits for a period not to exceed four years from the date of discharge, together with interest, costs, and attorney fees, less earnings that the employee earned or with reasonable diligence could have earned during the interim. The court may also order such other action, for example reinstatement, as will effectuate the purpose of the bill and, if the court finds that the employer acted maliciously or in intentional disregard of the employee's rights, may order punitive damages based on the amount of lost wages and lost fringe benefits awarded.

For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB160,1 Section 1. 103.11 of the statutes is created to read:

AB160,3,2 103.11 Wrongful discharge from employment. (1) Definitions. In this section:

AB160,3,9 (a) "Constructive discharge" means the voluntary termination of employment by an employee because of a situation created by an act or omission of his or her employer that an objective, reasonable person would find so intolerable that voluntary termination is the only reasonable alternative. "Constructive discharge" does not include voluntary termination because of an employer's refusal to promote the employee or improve wages, responsibilities, or other terms and conditions of employment.

AB160,3,13 (b) "Discharge" means any termination of employment, including resignation, elimination of a job, layoff for lack of work, failure to recall or rehire, and any other reduction in the number of employees for a legitimate business reason. "Discharge" includes a constructive discharge.

AB160,3,15 (c) "Employee" means a person who performs labor for an employer for compensation.

AB160,3,21 (d) "Employer" means a person engaging in any activity, enterprise, or business in this state employing one or more persons on a permanent basis. "Employer" includes the state and any office, department, independent agency, authority, institution, association, society, or other body in state government created or authorized to be created by the constitution or any law, including the legislature and the courts.

AB160,3,24 (e) "Good cause" means reasonable, job-related grounds for dismissal based on a failure to satisfactorily perform job duties, disruption of the employer's operation, or any other legitimate business reason.

AB160,4,4 (f) "Lost fringe benefits" means the value of any employer-paid vacation leave, sick leave, health insurance plan, disability insurance plan, life insurance plan, and pension benefit plan in force on the date of termination of employment that the employee would have received had the employee not been discharged.

AB160,4,8 (g) "Lost wages" means the gross amount of wages that would have been reported to the Internal Revenue Service as gross income on form W-2 had the employee not been discharged and includes additional compensation deferred at the option of the employee.

AB160,4,12 (h) "Probationary period" means a period of 6 months from the date an employee is hired, unless the employer, at the time the employee is hired, expressly provides for a shorter probationary period or for no probationary period, in which case "probationary period" means that period so provided.

AB160,4,15 (i) "Public policy" means a policy in effect at the time of the discharge concerning the public health, safety, or welfare established by constitutional provision, statute, or administrative rule or regulation.

AB160,4,18 (j) "Wrongful discharge" means a discharge from employment that is unfair for a reason specified in sub. (2) (b) or that is for a wrongful reason specified in sub. (2) (c).

AB160,4,21 (2) Wrongful discharge; exceptions. (a) No employer may discharge an employee unfairly or for any wrongful reason, except that this prohibition does not apply to any of the following:

AB160,4,23 1. A discharge that the employee has chosen to contest under any other state or federal law that provides a procedure or remedy for contesting the discharge.

AB160,4,24 2. A discharge that is covered by a written collective bargaining agreement.

AB160,5,2 3. A discharge that is covered by a written contract of employment for a specific term.

AB160,5,5 4. A discharge of an employee who any other state or federal law specifically provides is an employee at will or is to serve at the pleasure of a public official or other appointing authority.

AB160,5,10 (b) Paragraph (a) does not preclude an employer from discharging an employee for a violation of a work rule or performance standard if the procedures used to discharge the employee are fair. For purposes of par. (a), a discharge of an employee for a violation of a work rule or performance standard is unfair if any of the following applies:

AB160,5,12 1. The work rule or performance standard was not made known to the employee prior to the discharge.

AB160,5,14 2. The employer failed to enforce the work rule or performance standard in similar situations for a prolonged period.

AB160,5,18 3. The employer did not conduct an interview with the employee, or hold a hearing, concerning the violation prior to the discharge, did not conduct that interview or hearing promptly after the violation, or did not provide the employee with a precise description of the conduct constituting the violation.

AB160,5,20 4. The employer did not prove by clear and convincing evidence that the employee committed the violation.

AB160,5,23 5. The violation is the same as or substantially similar to a violation committed by another employee who was not discharged for committing the same or a substantially similar violation.

AB160,5,25 6. Unless the violation is egregious, the employer failed to first apply a less drastic form of discipline for the violation.

AB160,6,2 7. The discharge is disproportionate to the gravity of the violation, taking into consideration any mitigating or aggravating circumstances.

AB160,6,4 (c) For purposes of par. (a), a discharge is for a wrongful reason if any of the following applies:

AB160,6,6 1. The discharge was in retaliation for the employee's refusal to violate a public policy or reporting a violation of a public policy.

AB160,6,8 2. The employer violated the express provisions of its own written personnel policy.