North Carolina is an at-will employment state, but recognizes a limited exception from that rule for terminations that violate the state’s public policy. Courts have wrestled for years over the meaning of public policy and whether certain employee actions fell within that protection. Last week, the Fourth Circuit Court of Appeals — interpreting North Carolina law — held that general allegations about client care standards were sufficient to state a claim of wrongful discharge.

The plaintiffs in the case were counselors at a mental health and substance abuse treatment facility. They were concerned about a client in crisis and recommended in-patient treatment. The plaintiffs allege that their recommendations were overruled by their supervisor, and that the client died from an overdose several days later. After complaining about the supervisor’s decision to the regional director, the plaintiffs allege that they were threatened and later fired for their complaints. Several months later, they filed administrative complaints with the state agency that oversees the facility.

The district court dismissed the claims on the basis that the plaintiffs failed to state a claim for wrongful discharge. The plaintiffs cited a North Carolina statute that governs care standards for substance abuse facilities. The court based its dismissal on the lack of clearly expressed public policy, and the fact that the plaintiffs did not plead specific violations of legal requirements within the statute in their complaint. It also noted that the complaint with the state was not filed until after the terminations.

The Fourth Circuit disagreed, remanding the claim for further proceedings. The court said that wrongful discharge complaints can be based on broad citations to North Carolina statutes without alleging facts that match each alleged breach to a specific statutory provision. Next, the court found that the internal complaints were made according to North Carolina requirements for licensed counselors and fell within the public policy protections needed to state a wrongful discharge claim.

While this case is not binding precedent for North Carolina state courts, it shows that wrongful discharge claims can be brought based on a broader concept of public policy. Employees who are terminated for acting in conformance with statutory or other prescribed legal procedures have the potential to file wrongful discharge lawsuits and seek compensatory and punitive damages.

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