In Chenarides v. Bestfoods Baking, 2005 WL 1088983 (Conn. Super. Ct. March 30, 2005), a Connecticut Superior Court expanded the tort of wrongful discharge in violation of public policy, by holding that a plaintiff could base such a claim on the public policy of a statute that did not apply to the employer at issue. Specifically, the Chenarides Court held that a plaintiff allegedly fired for internal whistleblowing activities at a privately held company may sue for wrongful discharge based on the public policy of Conn. Gen. Stat. § 31-1336, which is Connecticut’s version of the SarbanesOxley Act, and which prohibits retaliation against whistleblowers in publicly held companies, but does not apply to privately held companies.

The plaintiff in Chenarides was the former Director of Human Resources. He sued his former employer, Bestfoods, alleging that he was illegally terminated for conducting a fraud and corruption investigation that implicated other employees of Bestfoods or its subsidiaries. The plaintiff styled his complaint as one for wrongful discharge in violation of public policy, claiming that his termination contravened the public policies against fraud and corruption in the workplace.

Bestfoods filed a motion attacking the complaint, arguing that the plaintiff could not establish that his discharge implicated any important public policy, which must derive from a statute or constitutional provision, because there are no Connecticut laws or constitutional provisions which protect internal whistleblowing at a privatelyheld company. This is an argument that one would have expected to have some traction, for at least two reasons. First, Connecticut courts have historically recognized a cause of action for wrongful discharge in violation of public policy only in very limited circumstances. Otherwise, what started out as a very narrow exception to the employment at-will doctrine could swallow the rule.

Second, the Connecticut Supreme Court had previously rejected a plaintiff’s attempt to rely on the public policy inherent in a statute that did not apply to her former employer to support her cause of action for wrongful discharge in violation of public policy. Specifically, in Thibodeau v. Design Group One Architects, LLC, 260 Conn. 691 (2002), the Connecticut Supreme Court held that a former employee of an employer with fewer than three employees could not rely on the public policy of Connecticut’s pregnancy discrimination statute, which applies only to employers with three or more employees, to support her claim for wrongful discharge in violation of public policy. In so ruling, the Court reasoned that the exemption contained in the pregnancy discrimination statute for employers with fewer than three employees is, itself, an expression of public policy that cannot be separated from the law’s ban on discriminatory employment practices. The Court concluded that the legislature chose to exempt smaller employers from the purview of the statute so that smaller employers would not be subjected to the financial and other burdens of defending employment discrimination claims. Accordingly, the Thibodeau Court held that the public policy of the pregnancy discrimination statute could not support a claim of wrongful discharge in violation of public policy against an employer specifically exempted from the statute.

Notwithstanding this legal backdrop, the Chenarides Court denied Bestfoods’ motion and held that the plaintiff could pursue his claim for wrongful discharge in violation of the public policy contained in Conn. Gen. Stat. § 31-1336, despite the fact that this statute does not apply to Bestfoods. Specifically, the Court reasoned that, unlike in the Thibodeau case, where small employers were exempt from the pregnancy discrimination statute as an expression of public policy, limiting the applicability of Conn. Gen. Stat. § 31-1336 to public companies was not an expression of policy against protecting whistleblowers of privately held companies. In fact, the Court reasoned that such a conclusion would be inconsistent with the fact that, at the time Conn. Gen. Stat.§ 31- 1336 was enacted, another statute, Conn. Gen. Stat. § 31-51m already afforded broad protection from retaliatory discharge to employees of both public and private companies. (What the Chenarides Court ignored, however, is that Conn. Gen. Stat. § 31-51m also did not apply to that case, since the statute protects against retaliation for whistleblowing to a state or federal enforcement agency, but does not apply to strictly intra-company whistleblowing.) The Court concluded that Conn. Gen. Stat.§ 31-1336 expresses a general policy with regard to whistleblowers, which is to protect employees who report fraudulent conduct from retaliatory actions by their employers, and that this public policy could support the plaintiff’s claim of wrongful discharge in violation of public policy.

Because Chenarides is a Superior Court decision, other Connecticut courts will not be required to follow it. However, to the extent that this decision may signal a trend in the courts to expand the tort of wrongful discharge in violation of public policy, it raises an issue that may be worth watching. In the meanwhile, employers should be cautioned that they may find themselves defending claims for violating the public policy of a statute, even where the statute does not apply to them.