Texas Supreme Court: Public Entities Immune from Retaliatory Discharge Claims

A ruling by the Texas Supreme Court will make it more difficult for former employees of public entities to pursue retaliatory discharge claims against those organizations.

The Court has held that a political subdivision has immunity from a state law prohibiting retaliatory discharge of an employee after the filing of a workers’ compensation claim.

The state’s high court said an appeals court erred in allowing a retaliatory discharge claim against Travis Central Appraisal District (TCAD) to proceed because the case upon which the appeals court relied is no longer the “controlling authority” in such cases due to changes in state statute.

Delivering the opinion of the Court, Justice David Medina explained that Diane Lee Norman went to work for the TCAD as a probationary employee in January 2006. “She was terminated about six months later, shortly after filing a workers’ compensation claim. Norman claimed that she was terminated for seeking workers’ compensation benefits and sued TCAD for retaliatory discharge under Chapter 451 of the Labor Code.” Chapter 451 is known as the Anti-Retaliation Law.

Denying Norman’s allegations, TCAD subsequently filed a plea stating that “Norman was required to exhaust her administrative remedies under TCAD’s grievance procedures before filing suit.”

The trial court denied TCAD’s plea and on appeal, “TCAD repeated its exhaustion-of-administrative-remedies argument but also argued that governmental immunity had not been waived for Norman’s retaliatory discharge claim, notwithstanding our decision in City of LaPorte v. Barfield to the contrary. Rejecting both arguments, the court of appeals affirmed the trial court’s order denying TCAD’s plea,” Medina wrote.

Medina explained that in Barfield, the Texas Supreme Court relied on provisions “in the 1981 and 1989 versions of the Political Subdivisions Law … and we ultimately found in their text a clear waiver of immunity for retaliatory discharge claims brought under the Anti-Retaliation Law.”

In 2005, however, the Legislature overhauled the state’s workers’ compensation system and revised the Workers’ Compensation Act. Among the statutes changed was the Political Subdivisions Law. In a new section on political subdivisions that elect to self-insure, lawmakers included “a broadly-worded provision, stating that ‘[n]othing in this chapter waives sovereign immunity or creates a new cause of action,'” Medina wrote.

He said it is not apparent why the provision was included in that particular section, but “the provision plainly purports to apply to the entire chapter, which, of course, includes the part that Barfield interpreted to waive the government’s immunity for retaliatory discharge claims.”

The Court concluded that the Political Subdivision Law is changed to the extent that its previous interpretation as to the waiver of immunity for political entities no longer applies.

As such, because “the court of appeals permitted the plaintiff’s claim to proceed, as Barfield would have, we must under the current law reverse the court of appeals’ judgment and dismiss the case,” Medina wrote.

The case is No. 09-100; Travis Central Appraisal District v. Diane Lee Norman.