In a case appealed from the Superior Court of Orange County, the Fourth Appellate District agreed with the broad standard set forth in the trial court in determining whether or not an employee’s termination violated public policy. In Casella v. Southwest Dealer Services, Casella claimed that his employment was terminated because he reported the company’s participation in its clients’ fraudulent business practices. Although there was no specific statute to criminalize these practices, the court relied on Penal Code section 487, which broadly proscribes theft by false pretense through fraudulent misrepresentations. In citing other cases they concluded that “when an employer discharges an employee who refuses to defraud a customer, the employer has violated a fundamental public policy and may be liable and charged with wrongful discharge.”
Lesson learned: Be very careful how you deal with any employee who claims employer wrongdoing. Be sure to get the advice of experienced employment law counsel immediately.