Tennessee’s governor just signed a highly significant employment litigation reform bill that will benefit employers throughout the state. The new law applies to all causes of action starting July 1, 2014. The bill places caps on the availability of non-monetary damages (pain, suffering, humiliation, embarrassment, etc.) that employees can seek under the Tennessee Human Rights Act (THRA), the Tennessee Disability Act (TDA), and the Tennessee Public Protection Act (TPPA). The caps range from $25,000 to $300,000, depending on the number of employees that the employer employs. The caps do not limit back pay or front pay.
This legislation also eliminates common law claims for retaliatory discharge in any litigation that could be brought under the TPPA. Previously, employees could bring both common law and statutory claims for “whistleblowing,” which the statute defines as the refusal to participate in or remain silent about illegal activities. But, under this new legislation, an employee may only pursue such claims under the TPPA, which requires the employee to prove that the alleged whistleblowing was the “sole cause” of the termination. As a result, the new law essentially prevents employees from benefiting from the common law’s lower causation standard.
In addition, the new law provides that an employee may not concurrently maintain separate causes of action brought under the THRA, TDA, and TPPA in both state and federal courts based on the same operative facts. Now the state court is required to dismiss the state court action upon motion by the employer.
Finally, the new law eliminates individual supervisor liability that had been available under the THRA—forcing employees to bring their claims against their employer, rather than the individual supervisors or managers involved in decision-making relating to the employee’s employment.
These new changes are a “win” for Tennessee employers in their defense of discrimination and retaliation claims. Starting July 1, 2014, the THRA, TDA, and TPPA will be in line with the current state of most federal nondiscrimination laws.