MI Supreme Court clarifies, expands public-policy at-will employment exception

On July 15, 2022, the Michigan Supreme Court clarified and, arguably, expanded the state’s public-policy exception to the well-established at-will employment doctrine. Although the case may conclude differently after being sent back to the lower court, the ruling represents a clear allowance of certain public-policy claims, eroding the at-will employment presumption enjoyed by Michigan employers for decades.

Background

While working through a staffing agency at an assembly plant in Sterling Heights in April 2016, Cleveland Stegall reported what he believed was a problem with asbestos insulation. He emailed photos of the area to his supervisor, who forwarded them to the plant’s health and safety manager. Based on Stegall’s report, management consulted an outside expert, who concluded there was no asbestos issue.

In May, the plant announced it was ending the production line Stegall worked on, and in June, it informed him he would be let go. Believing it was retaliation for his asbestos report, he sued both the assembly plant and the staffing agency for wrongful discharge in violation of public policy. The trial court dismissed his claim, and he appealed to the Michigan Court of Appeals.

Appeals court weighs in

In September 2019, the appeals court ruled Stegall’s public-policy wrongful discharge claim failed because he only made an “internal report” of alleged asbestos contamination in the workplace. It held the public-policy exception to the at-will presumption allows protection for only external (or public body) reports and retaliation for making such reports.