Phung v. Waste Management, Inc., No. 84-1909

• Court: United States State Supreme Court of Ohio
• Writing for the Court: DAHLING; CELEBREZZE; DAHLING, J., of the Eleventh Appellate District, sitting for DOUGLAS; HOLMES; CLIFFORD F. BROWN; SWEENEY
• Citation: 23 OBR 260,491 N.E.2d 1114,23 Ohio St.3d 100
• Parties: , 122 L.R.R.M. (BNA) 2163, 104 Lab.Cas. P 55,602, 23 O.B.R. 260, 2 IER Cases 786 PHUNG, Appellee, v. WASTE MANAGEMENT, INC. et al., Appellants.
• Decision Date: 16 April 1986
• Docket Number: No. 84-1909

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23 Ohio St.3d 100 491 N.E.2d 1114, 122 L.R.R.M. (BNA) 2163, 104 Lab.Cas. P 55,602, 23 O.B.R. 260, 2 IER Cases 786 PHUNG, Appellee,
v.
WASTE MANAGEMENT, INC. et al., Appellants. No. 84-1909. Supreme Court of Ohio. April 16, 1986. Syllabus by the Court

1. Public policy does not require that there be an exception to the employment-at-will doctrine when an employee is discharged for reporting to his employer that it is conducting its business in violation of law. (Mers v. Dispatch Printing Co. [1985], 19 Ohio St.3d 100, distinguished.)

2. An at-will employee who is discharged for reporting to his employer that it is conducting its business in violation of law does not have a cause of action against the employer for wrongful discharge.

Dr. Peter L. Phung, appellee, was employed as the chief chemist for Waste Management, Inc. at its toxic waste disposal site in Vickery, Ohio, from April 1, 1979 through April 30, 1981, at which time Waste Management, Inc. terminated Dr. Phung's at-will employment relationship with the company. In response, Phung filed the instant action against Waste

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Management, Inc. and his former supervisor, Francis J. Sidoti, appellants herein.

Phung made the following allegations in his first cause of action:

"4. * * * During the approximate two-year period of his employment * * * [with defendant], Phung performed all duties required of him and directed * * * [defendant's] attention to its various statutory, regulatory, and societal obligations.

"5. During the course of his employment, Phung became aware that the defendant * * * was violating, on a large scale basis, its legal and societal obligations.

"6. Upon ascertaining the nature, extent, and duration of such violations, plaintiff directed the defendants' attention and demanded that such violations cease.

"7. Rather than complying with the plaintiff's demand to cease such violations, the defendants' [sic ] wrongfully terminated the plaintiff's employment.

"* * *

"9. The action by the defendants in terminating the plaintiff's employment was in retaliation for his requirement that the defendants terminate the hereinbefore alleged violations and were [sic ] intentional and tortious in nature."

Defendants moved to dismiss Phung's first cause of action on the ground that a claim for wrongful discharge of an at-will employee is not cognizable under Ohio law. The trial court granted defendants' motion to dismiss, rejecting Phung's invitation to carve out a "public-policy exception" to the general rule that employment is generally terminable at-will by either party. In so ruling, the trial court noted that such a development in the law would require action either by the legislature or by this court.

A divided court of appeals reversed. The court of appeals held that:

"Public policy requires that there be an exception to the absolute right of an employer[491 N.E.2d 1116] to discharge an employee at will when such employee is discharged for reporting to his employer or proper authorities that the employer is conducting its business in violation of law."

Further, the court of appeals held that an at-will employee who is discharged for so reporting such violations has a cause of action against the employer for wrongful discharge, which action may sound in tort.

The cause is now before this court pursuant to the allowance of a motion to certify the record.

Murray & Murray Co., L.P.A., Dennis E. Murray and Kirk J. Delli Bovi, for appellee.

Bergson, Borkland, Margolis & Adler, Jeffrey G. Miller, Nicholas T. Christakos, Smith & Schnacke, John W. Edwards, Martin H. Lewis, Starn & Bowlus and John D. Starn, for appellants.

Bricker & Eckler, G. Roger King and Catherine Adams, urging reversal for amicus curiae, Ohio Chamber of Commerce.

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Mid-America Legal Foundation, John M. Cannon, Susan W. Wanat and Ann Plunkett Sheldon, urging reversal for amicus curiae, Ohio Manufacturers' Association.

Louis A. Jacobs and Bruce A. Campbell, urging affirmance for amicus curiae, American Civil Liberties Union of Ohio Foundation, Inc.

DAHLING, Justice.

Ohio has long adhered to the general rule that "either party to an oral employment-at-will agreement may terminate the employment relationship for any reason which is not contrary to law." Mers v. Dispatch Printing Co. (1985), 19 Ohio St.3d 100, 103, 483 N.E.2d 150. "* * * Employment contracts can be terminated at will for any cause, at any time whatsoever, even if done in gross or reckless disregard of any employee's rights." Peterson v. Scott Constr. Co. (1982), 5 Ohio App.3d 203, 205, 451 N.E.2d 1236; Wolf v. First National Bank of Toledo (C.P.1980), 20 O.O.3d 262, 263; Dadas v. Prescott, Ball & Turben (N.D. Ohio 1981), 529 F.Supp. 203, 206; Parets v. Eaton Corp. (E.D.Mich.1979), 479 F.Supp. 512, 519 (construing Ohio law). A fundamental policy in favor of the employment-at-will doctrine is the principle that parties to a contractual relationship should have complete freedom to fashion whatever relationship they so desire.

While this court recently held "that where appropriate, the doctrine of promissory estoppel is applicable and binding to oral employment-at-will agreements" (Mers, supra, at 105, 483 N.E.2d 150), Ohio has not yet recognized any public policy exceptions to the employment-at-will doctrine. We do not believe that public policy considerations warrant an exception being made in the case sub judice, nor do they create a cause of action sounding in tort against the employer for wrongful discharge.

In the case sub judice, Phung's claims are nothing more than broad, conclusory allegations that Waste Management, Inc. was violating certain unspecified legal and societal obligations (complaint paragraph No. 5), that Phung directed Waste Management, Inc.'s attention to these violations (complaint paragraph No. 6), that Waste Management, Inc. terminated Phung's employment rather than cease the violations (complaint paragraph No. 7), and that the discharge was made in retaliation for Phung's demand that the violations cease (complaint paragraph No. 9).

In ruling on a motion to dismiss under Civ.R. 12(B)(6), the material allegations of the complaint are taken as admitted. State, ex rel. Alford, v. Willoughby (1979), 58 Ohio St.2d 221, 390 N.E.2d 782 [12 O.O.3d 229]. In the context of a Civ.R. 12(B)(6) motion, the court is obliged to assume as true the factual allegations of the complaint. Royce v. Smith (1981), 68 Ohio St.2d 106, 429 N.E.2d 134 [22 O.O.3d 332]. An appellate court may not assume as true or even consider facts alleged in a party's brief or attachments thereto. Scheer v. Air-Shields, Inc. (1979), 61 Ohio App.2d 205, 401 N.E.2d 478. [15 O.O.3d 321].

The allegations herein failed to state a violation of a sufficiently clear public policy [491 N.E.2d 1117] to warrant creation of a cause of action in favor of Phung. No jurisdiction has allowed a cause of action to proceed based only on vaguely alleged violations of "societal obligations."

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Public policy does not require that there be an exception to the employment-at-will doctrine when an employee is discharged for reporting to his employer that it is conducting its business in violation of law.

An at-will employee who is discharged for reporting to his employer that it is conducting its business in violation of law does not have a cause of action against the employer for wrongful discharge.

Furthermore, the Ohio Constitution delegates to the legislature the primary responsibility for protecting the welfare of employees. Sections 34 and 35 of Article II authorize the General Assembly to adopt laws regulating minimum wages, health and safety and hours of labor and to provide a plan for workers' compensation. In the past, this court has deferred employment matters to the legislature. State, ex rel. Clark, v. Brown (1965), 1 Ohio St.2d 121, 205 N.E.2d 121 [30 O.O.2d 478].

It should be noted that the legislature has addressed problems arising in the area of retaliatory discharge. The General Assembly has enacted legislation which provides that:

" * * * No employer shall discharge, demote, reassign, or take any punitive action against any employee because such employee filed a claim or instituted, pursued or testified in any proceedings under the workers' compensation act for an injury or occupational disease which occurred in the course of and arising out of his employment with that employer. * * *" R.C. 4123.90.

The legislature has also prohibited discriminatory practices in the discharge of employees, as follows:

"It shall be an unlawful discriminatory practice:

"(A) For any employer, because of the race, color, religion, sex, national origin, handicap, age, or ancestry of any person, to discharge without just cause. * * *" R.C. 4112.02. There can be no better expression of the public policy of a state than duties specifically imposed by statute. See Mers, supra, at 103, fn. 2, 483 N.E.2d 150.

For reason of the foregoing, the judgment of the court of appeals is...