Houston Wrongful Discharge Lawsuit

Texas is an at-will employment state, meaning that unless there is a contractual agreement saying otherwise, an employee employed for an indefinite term may be terminated at will without cause. A Beaumont wrongful termination lawsuit appealed to the Texas Supreme Court created an exception to the employment at-will doctrine. In its 1985 Sabine Pilot decision, the Texas Supreme Court affirmed a wrongful termination lawsuit from the Beaumont Court of Appeals reasoning that public policy required a very narrow exception covering only the firing of an employee for the reason that the employee refused to perform an illegal act. See, Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d 733 (Tex.1985).

Why? When an employer asks an employee to perform some act that is illegal, the employer places the employee in an unacceptable position of having to risk being fired or risk facing criminal penalties because the employee is saddled with the onus of being fired for insubordination. Recognized first by the Beaumont Court of Appeals and then created by the Texas Supreme Court as an exception to the Texas employment-at-will doctrine, this wrongful termination tort action promotes public policy preventing workers from being forced by employers to decide between their jobs and facing criminal prosecution and liabilities. When an unscrupulous employer forces an employee to decide between committing a crime and keeping their job and then fires the employee because the employee refuses to commit the crime, the employee subjected to the wrongful termination may bring a claim against the employer as result Michael Hauck suing Sabine Pilot.

The Sabine Pilot decision has applied in different types of employment. For example, in a Houston Court of Appeals decision styled Nguyen v. Technical And Scientific Application, Inc., 981 S.W.2d 900 (Tex.App.-Houston[1st.Dist.] 1998), the issue presented to the appellate court was whether an employee who is constructively discharged, but not fired, may sue for wrongful termination under the Sabine Pilot exception to the at-will employment doctrine.

In late 1996, Nguyen worked as a network engineer for TSA. According to the opinion, Nguyen was ordered to load certain software onto personal computers and Nguyen believed the act violated federal criminal copyright laws, so he refused to do it. He was told if he did not load the software, he would receive a pay cut. As further stated in the court opinion, Nguyen was then transferred to the lab, a position he held when he first began working at TSA. Nguyen considered the transfer to be a demotion. In February 1997, he sent a resignation letter to TSA, stating that because he refused to load software illegally, he was humiliated, harassed, and tormented to the point that working for TSA was intolerable.

Afterward, Nguyen sued for wrongful termination and his employer responded by claiming that he could not state a claim for relief because Sabine Pilot did not apply to constructive discharge. As the Houston Court of appeals explained, a constructive discharge occurs when an employer forces the employee to quit by making work conditions intolerable. It may constitute a legal substitute for the discharge element in, for example, discrimination cases under Title VII of the Civil Rights Act of 1964. Discussing this and other case law it found relevant to the issue, the Houston Court of Appeals disagreed with the employer’s position that the court was powerless to do anything and reversed the trial court order, stating that the court doubted the Texas Supreme Court intended to permit employers to avoid liability by coercing resignations from, rather than firing, their employees who refused to break criminal laws. As such, the Houston Court of Appeals held that the Sabine Pilot exception to the employment-at-will doctrine applied to employees who are constructively discharged.

Again, as decisions from a Houston Court of Appeals reflect, the Texas Supreme Court created this tort to promote the public policy of preventing an employee from being forced to choose between keeping his or her job and facing criminal liability. Physio GP, Inc. v. Naifeh, 306 S.W.3d 886 (Tex.App. – Houston [14thDist.] 2010, no pet.); Higginbotham v. Allwaste, Inc., 889 S.W.2d 411 (Tex.App. – Houston [14thDist.] 1994, writ den’d).

Whether wrongful termination occurs in Houston or elsewhere in Texas, employees terminated from their employment because of their refusal to commit an illegal act or crime may have a potential wrongful termination case and may consult an attorney to determine if the particular facts and circumstances of the employment termination, as well as the current state of the law, support pursuit of a wrongful termination lawsuit.