Thursday, May 22, 2014
Federal Regulatory Law Trumps State Law Wrongful Termination Claims
As the federal regulatory scheme expands in covering various industries, it's important to remember that these regulatory systems frequently act to preempt state coverage of employment law issues, particularly in the area of retaliation. The federal government maintains anti-retaliatory legal regimes in aviation, energy, securities, banking, and a host of other areas. Frequently it is to the advantage of the employer to be able to move a case from state court and to either a federal court or federal administrative law forum.
That’s what happened in a federal Ninth Circuit Court of Appeals case involving a flight engineer (pilot) and his employer, Japan Airlines. The plaintiff alleged that a fellow pilot was not medically qualified or fit to operate an aircraft. This is a classic safety of flight complaint, and an employee who raises such an issue is protected under FAA law and regulations as a whistleblower. The plaintiff alleged that following his complaint, JAL in retaliation required him to undergo psychiatric evaluation and prevented him from working as a flight engineer. The flight engineer sued claiming a violation of the California state law whistleblower statute, along with a wrongful termination in violation of public policy count (another state claim), and a violation of AIR21, a federal statute which deals with retaliation protection for whistleblowers under the federal aviation law.
The Ninth Circuit determined that the FAA whistleblower law and its retaliation provisions preempted any state law claims because of the nature of the plaintiff’s allegations. Specifically, by complaining about pilot qualification and medical standards, two areas where the federal regulatory framework is so pervasive and federal interest so dominant that states are presumed to have no interest, the plaintiff pleaded himself out of state court. The court noted that there was no such federal preemption with respect to employment law or related aviation claims such as race or gender discrimination, but that safety of flight issues were solely a federal matter. Just something to keep in mind if you work in a highly regulated federal arena.