Retaliatory Discharge Claim May Proceed to Arbitration
Dillard’s Inc. v. Kenneth Gallups:
On September 10, 2010, the Alabama Court of Civil Appeals released this opinion in which it considered whether a retaliatory discharge claim (that stems from a workers’ compensation claim) arises under the Alabama Workers’ Compensation Act.
The case involved an arbitration agreement signed by the employee. The language of the agreement required that any alleged retaliation for filing a protected claim for benefits (or exercising a protected right) was to be arbitrated; but claims for injuries covered by workers’ compensation were not to be arbitrated. The trial court in ruling for the employee found that a retaliation claim based on a workers’ compensation claim was "an injury covered by workers’ compensation" because it arose from the Act; and so was not subject to arbitration under the agreement.
On appeal, the Court of Appeals found that in accordance with previous case law, retaliatory discharge claims are treated as traditional tort claims and so this claim would not arise under the Alabama Workers’ Compensation Act. Since the retaliatory discharge claim did not arise under the Act; it was covered by the provision in the agreement that mandated arbitration for the filing of retaliation claims. The Court reversed the opinion of the lower court and remanded with instructions to compel arbitration.