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Illinois Court Finds ‘Shoplifting and No Apprehension’ Policy Vulnerable to Whistleblower Claims

A retail employer is liable under the Illinois Whistleblower Act (“IWA”) when it terminates an employee for violating its “shoplifting and no apprehension” policy prohibiting employees from calling law enforcement directly about suspected shoplifting, an Illinois federal court has found. Coffey v. DSW Shoe Warehouse, Inc. a/k/a DSW, Inc., No. 14 C 4365 (Oct. 29, 2015).

Under the IWA, employers are prohibited from retaliating against employees who report unlawful activity — committed by anyone — which they have reasonable cause to believe is occurring or has taken place, to a government or law enforcement agency.

Coffey provides incentive for retailers and other employers to revisit handbook and policies on reporting illegal conduct.

Background

The plaintiff, Melissa Coffey, worked as an assistant store manager for DSW Shoe Warehouse. During her employment, one of Coffey’s subordinates informed her that a group of women, who the subordinate suspected of shoplifting in the past, had returned to the store that day. Coffey responded by announcing through her walkie-talkie, which connected her to all employees in the store, “I think we’re going to call the police.” A store employee, who heard Coffey’s announcement, took it as a directive and called the police. Police arrived, did a “walk-through” of the store, but did not make an arrest.

DSW subsequently terminated Coffey for violating its shoplifting and no apprehension policy, which prohibited employees from calling law enforcement, mall security, or third parties to respond to suspected theft. The policy included the following:

Under no circumstances is law enforcement, mall security or any other third party to be called to notify or respond to a suspected shoplifting/theft incident. If special circumstances exist (such as a high dollar theft, grab and run, etc.), immediately contact your RLPM [Regional Loss Prevention Manager] for direction. The RLPM is the only individual who may authorize an exception. This authorization must be obtained prior to any call to law enforcement.

Coffey claimed her termination violated the IWA.

Decision

The court granted Coffey’s motion for summary judgment, finding the IWA applicable to retaliatory discharges based on reports of employer misconduct or third party misconduct (here, reporting suspected customer theft). Coffey’s termination, based on her violation of DSW’s policy, the court found, constituted retaliatory discharge.

Among its conclusions, the court found:

  1. under the IWA, a whistleblower may directly or through another person, inform a governmental agency of unlawful conduct;

  2. the IWA protects whistleblowers who report employer misconduct or third-party misconduct;

  3. the IWA protects whistleblowers who report what they reasonably believe to be unlawful conduct;

  4. Coffey engaged in protected activity by indirectly informing the police of suspected customer theft; and

  5. her subsequent termination for violating DSW’s policy constituted retaliatory discharge.

Employer Policies

Although the court did not expressly find DSW’s policy in violation of the IWA, the statutory language appears to prohibit such policies.

Under the IWA, employers are prohibited from making policies “preventing an employee from disclosing information to a government or law enforcement agency….” 740 ILCS 174/10. However, the IWA is not clear as to whether an employer faces any monetary damages for having, but never enforcing, a policy prohibiting employees from directly reporting criminal activity to law enforcement.

The safest course may be to eliminate such “chain of command” criminal reporting requirements, thereby minimizing the likelihood that an unwary supervisor would discipline an employee for directly reporting criminal activity to law enforcement.

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Jackson Lewis P.C. © 2020National Law Review, Volume V, Number 348
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About this Author

Paul Patten, Employment, Management, Attorney, Jackson Lewis Law Firm
Principal

Paul Patten is a Principal in the Chicago, Illinois, office of Jackson Lewis P.C. He represents management in employment cases in federal and state courts and before administrative agencies.

Mr. Patten’s practice focuses primarily on employment litigation and counseling. He represents employers in federal and state individual and class-based lawsuits covering a wide range of statutes and subjects, including federal and state anti-discrimination and wage and hour laws.

312-803-2570
Melanie Stewart, Jackson Lewis, employment regulation lawyer, labor compliance attorney, company management legal counsel
Associate

Melanie I. Stewart is an Associate in the Chicago, Illinois, office of Jackson Lewis P.C. She represents management in all areas of employment and labor law.

Prior to joining Jackson Lewis, Ms. Stewart completed an in-house counsel fellowship at The Johns Hopkins Health System Legal Department, focusing on labor and employment law matters for the health system, an organization with over 20,000 employees across states and the District of Columbia. At Hopkins, Ms. Stewart later worked as an EEO Compliance Consultant where she conducted internal...

312-787-4949
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