Wrongful Termination in Oregon

by Joel Christiansen

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The attorneys at Vogele & Christiansen represent businesses and individuals in wrongful termination cases throughout the state. This article provides a brief summary of wrongful termination law in Oregon.

Legal Requirements for an Oregon Wrongful Termination Case

Oregon is an at-will employment state, which means an employer may discharge an employee for any reason or no reason at all. To successfully assert a wrongful termination claim, an employee must be able to prove that an employer violated a specific law (e.g., Title VII, Oregon Equality Act, ORS 659A.003 et seq., state common law, Oregon wage and hour law, etc.) or breached an enforceable employment contract. An employee who asserts a wrongful termination claim will have the burden to prove their case with admissible evidence. This means that suspicion and belief alone will not be sufficient to prove a case. It requires witnesses, documents, and other evidence.

Oregon law provides remedies only in specific cases, including those where an employee is terminated: (1) based on a protected class; (2) based on protected activity; and (3) in breach of an enforceable contract. Generally speaking, unless a termination fits into one of these categories, an employee will not likely have any legal recourse for a termination.

Protected Class: Oregon and federal law protect people who belong to “protected classes.” Protected classes include race, color, national origin, gender, sexual preference, marital status, pregnancy, religion, age, disability, and crime victim status. An Oregon employee may successfully assert a wrongful termination claim against any employer that fires an employee because of an employee’s, or anyone with whom the employee associates’, membership in a protected class. An employee must be able to establish a causal link between membership in a protected class and the employer’s adverse action.

Protected Conduct: Employees who are fired for engaging in protected conduct may also be able to assert wrongful termination claims. “Protected conduct” includes, but is not limited to: reporting evidence of illegal conduct (evidence of internal policy violations or unethical conduct do not qualify), opposing unlawful employment practices, seeking or taking medical leave, requesting disability accommodations, making a wage claim, filing a workers’ compensation claim, reporting health and safety issues, and testifying in court proceedings.

Breach of Contract: Finally, employees who are terminated in violation of an employment contract may be able to assert a wrongful termination claim against a former employer. The employee will need to establish a written employment contract – and employee handbooks and policies will usually not suffice. For example, in a case I recently handled, my client successfully alleged that the employer violated a term in a written 3-year employment contract that guaranteed the employer would not materially alter the employee’s employment within the contract term.

Unfair, unethical, false, inconsistent, or contradictory terminations are not necessarily illegal. Our firm frequently receives inquiries concerning non-actionable “harassment,” “bullying,” or “discrimination” that is unrelated to any protected class, activity, or contract. Absent some specific legal violation, this conduct is usually not actionable because Oregon, like most states, is an “at will” employment state. That means an employer can fire an employee or change the terms and conditions of employment for any reason or no reason at all, even if the reason is a poor one. For better or worse, employers are allowed to be overbearing, rude, politically incorrect, and arbitrary in their treatment of employees.

Damages in Oregon Wrongful Termination Cases

The types of damages an employee will be able to recover will vary widely depending on the exact nature of the legal claims an employee brings. Wage loss can mount quickly in wrongful termination cases. Employees have a duty to mitigate damages by searching for and securing replacement work as soon as possible. Employees may qualify for a broad range of remedies, including economic damages, noneconomic damages, punitive damages, attorney fees, and costs. Some claims however, only provide remedies for lost wages and do not provide for recovery of noneconomic damages (e.g., Oregon family leave act claims).

The amount of damages is always a strong indicator of a case’s settlement value. While juries can and do award noneconomic damages, these awards are typically modest in comparison to the cases that sometimes make headlines. Employees with contained wage loss should form reasonable expectations about settlement value.

Procedure in Oregon Wrongful Termination Cases

There are several ways employees pursue Oregon wrongful termination claims. Likewise, employers utilize a variety of strategies in defending these claims.

Employees who wish to assert a wrongful termination claim against an employer have three basic options: (1) attempt to negotiate a settlement, (2) pursue a lawsuit or arbitration, or (3) initiate a government agency complaint. Union employees, public employees, and other special categories of employees may have additional rights.

Employers defending cases must choose whether to contest or attempt to settle claims. Businesses are required to retain counsel in claims filed in state or federal court. See, UPL Advisory Opinion No. 2013-2. Employers may be self-represented in settlement negotiations and government agency proceedings.

Employees must decide whether to seek attorney representation. For a variety of reasons, employees who retain counsel present a greater risk to employers and are generally taken more seriously by employers and their attorneys. Specifically, (1) employees with counsel are have greater access to the courts, which is an inherently risky and expensive proposition for employers, and (2) many wrongful termination cases involve statutes that create attorney fee liability for employers, which can dramatically affect settlement dynamics.

Most wrongful termination claims end up settling (this includes severance agreements). Settlements can occur at any time during the process. Settlements typically involve an employee signing a written settlement agreement, including a release and waiver of claims, in exchange for a payment of settlement funds and other terms. In order for a settlement to occur, the parties must agree on settlement terms.

A lawsuit is a formal, government-supervised process that parties can use to resolve their disputes. Litigated cases may proceed in state or federal courts depending on the details of the case. Many employee wrongful termination cases include claims for costs and attorney fees. The burden of proof for a plaintiff/employee in court is preponderance of admissible evidence, compared with BOLI’s significantly higher “substantial evidence” standard.

In recent years, many employment-related agreements mandate that disputes be resolved by arbitration. Arbitration is a private court-like process mandated by private contract. Some contracts even provide for (or, in any event, employers are often willing to discuss) non-binding mediation for resolution of claims. Both parties should pay close attention to employment agreements and policies to ensure compliance with alternative dispute resolution procedures.

Only cases that are well-supported by admissible evidence and involve sufficient damages are usually worth pursuing through an attorney. However, attorney fee shifting statutes may make some smaller cases viable. Cases seeking <$10k, including technical employer violations without significant harm, may be best handled through the Equal Employment Opportunity Commission (EEOC) or the Oregon Bureau of Labor and Industries (BOLI).