A recent Michigan Supreme Court decision sends the message that if you blow the whistle on your employer for an illegal act that hasn’t occurred yet, and then it never actually occurs, you are not protected by the state’s Whistleblower Protection Act (WPA).

In the case of Pace v. Edel-Harrelson, Christy Long and the Siren Eaton Shelter, Inc., Barbara Pace sued her former employer, the Siren Eaton Shelter, along with its executive director and its operations manager, for wrongfully terminating her in violation of Michigan’s WPA.

While employed at the Siren Eaton Shelter, Ms. Pace claimed that Christy Long, the Operations Manager, told her that she intended to use Siren Eaton Shelter grant money to purchase a stove for her daughter. Further, she asked Pace to cover up the transaction by documenting that  it was purchased by a client. Ms. Long denied both accusations.

Pace testified that she notified two supervisors of Long’s plan, but nothing happened. So she went directly to Jessica Edel-Harrelson, the Executive Director, in either December 2011 or January 2012. By that time, Pace said, she thought the purchase had already occurred.

Then, on January18, 2012, Pace was terminated for “harassing and intimidating behavior toward a fellow employee in violation of the defendant’s employment policies.” According to witnesses, Pace threatened violence against a co-worker who had called her out for telling an inappropriate joke.

Ms. Pace brought her suit in April, 2012. At that point Ms. Edel-Harrison made an official inquiry into the alleged purchase of the stove. She found the purchase had never occurred or even been attempted.

Michigan’s Whistleblower Protection Act (MCL 15.362) protects an employee who reports “a violation or a suspected violation of a law” to a public body. The Michigan Supreme Court examined the letter of the law in the WPA, which was that “(1) the plaintiff was engaged in protected activity as defined by the act, (2) the plaintiff was discharged or discriminated against, and (3) a causal connection exists between the protected activity and the discharge or adverse employment action.”

The trial court granted summary disposition for the Shelter and the two managers, ruling that Pace did not establish that an actual or suspected violation of the WPA had occurred, since no purchase had occurred or been attempted. But the Michigan Court of Appeals overturned  the lower court’s ruling and remanded the case back for trial, stating that Ms. Pace did establish enough of a case to bring it to a jury. The Shelter then appealed for review by the Supreme Court.

The High Court, focusing on the phrase “suspected violations of the law,” noted that a whistleblower “need not necessarily report an actual violation of the law to receive (the) protection” of the WPA. However it did not agree with the Court of Appeals’ holding that “where an employee has a good faith and reasonable belief that a violation of the law… is being actively planned, the report of the belief is sufficient to trigger the protections of the WPA.” The Supreme Court ruled that a violation of the law, even if only “suspected,” still needed to actually occur or be ongoing to trigger the protections of the WPA. There was no language in the law, it ruled, that a planned or anticipated act  amounted to a “suspected” violation of the law and therefore triggered those protections.

This decision raises some concerns. Most whistleblower cases involve subordinates reporting on superiors. That is never an easy thing for an employee to do in any circumstance. The prospect of blowing the whistle on a potential crime, as opposed to waiting for it to happen and then blowing the whistle, is even more daunting to the average employee. And to have to do it against a boss?

This ruling may put those being encouraged to whistle-blow—i.e., employees—at a disadvantage if they try to “do the right thing” before actual harm comes to the organization.

If protecting ethical persons from adverse employment actions when they try to prevent a legal harm to come to the organization is the purpose of the WPA, why suspend WPA protections for whistleblowing acts before the harmful or illegal act occurs?

Source: Barbara Pace v. Jessica Edel-Harrelson, Christy Long, and Siren Eaton Shelter, Inc.