June 3, 2015. Today, both the House and the Senate overrode Governor Pat McCrory’s veto of House Bill 405 (the Private Property Protection Act). From the beginning, animal welfare activists opposed H 405 as another attempt to enact “ag-gag” legislation in North Carolina. (The term “ag-gag” has been used by opponents of laws intended to deter activists from taking jobs with agricultural operations to document animal cruelty.) But House Bill 405 affects all employees – not just agricultural workers — and opposition to the bill broadened out of concern that the bill will discourage employees from documenting and reporting all sorts of unlawful activities.
Bill supporters, including the N.C. Chamber of Commerce, describe H 405 as necessary to protect businesses from activists, undercover reporters, and industrial spies. At its heart, the bill aims to discourage employees from making photographs, videos, and recordings in the workplace and using the documentation to the disadvantage of their employer. Supporters point to “whistle blower” protections in the bill to answer concerns that the bill will discourage employees from documenting and reporting dangerous, cruel and even criminal behavior.
Opponents fear the bill will become a shield for unlawful activity. The American Association of Retired Persons (AARP) lobbied against the bill because of the potential impact on documentation of abuse in nursing homes and other care facilities. Although not mentioned in the legislative debate, the bill could also deter employees from providing evidence of environmental and public health violations.
What the bill does. House Bill 405 allows an employer to take legal action against an employee who enters a “nonpublic” area of the workplace; takes photographs, makes recordings, or copies records without permission; and uses those documents against the interest of the employer. The employer can already fire the employee; H 405 allows the employer to also sue the employee for monetary damages, including legal fees and a $5,000 per day penalty.
Employees affected by the bill. Supporters describe H 405 as a defense against infiltrators and industrial spies, but the legal actions authorized by the bill are not limited to those circumstances. Some bill language seems to focus on employees who are not legitimately in the workplace to “do business with” the employer. But the bill can be interpreted to authorize legal action against any employee who makes photos, recordings or copies of records without permission and uses those documents against the employer’s interest. (The employer would certainly argue that the employee was not — at least in the moment — there “to do business with” the employer.) If the General Assembly intended H 405 to authorize legal action only against an employee who purposefully took the job to sabotage, collect damaging information or steal trade secrets, the law needs to be more clear.
Protection for “whistle blowers”. H 405 provides only limited “whistle blower” protection for private sector employees. The bill incorporates a number of anti-retaliation laws that shield employees who file claims under worker health and safety standards. So H 405 would not allow an employer to take legal action against an employee who documented violations of Occupational Safety and Health (OSHA) rules, mine safety regulations, or laws that protect agricultural workers from exposure to pesticides.
But none of the “whistle-blower” provisions in H 405 protect a private-sector employee who documents a violation of environmental standards, public health regulations, or other laws protecting the general public. Under H 405, an employee who (without the employer’s permission) photographs illegal dumping of hazardous waste and provides the photo to DENR could be required to pay damages to the company that caused the violation.
A model for whistle-blower protection. In debate on the veto override, legislators seemed to agree on both the need to protect businesses from unethical activities and the importance of shielding whistle blowers who uncover violations of the law. Legislators disagreed on how effectively House Bill 405 shields whistle-blowers. On this, bill opponents appear to have the stronger argument; H 405 does not protect private sector employees who document and report violations other than those directly related to worker health and safety laws.
But H 405 includes a reference to a state law that could be a model for providing more effective “whistle-blower” protection. In addition to protecting employees documenting violations of worker health and safety standards, H 405 bars legal action against state employees covered by G.S. 126-85. That law protects state employees who report unlawful, fraudulent or unsafe actions by a state agency as long as the employee did not know or have reason to know that the information reported was inaccurate.
The problem is that G.S. 126-85 only protects state employees who report violations caused by a state agency or a state employee. At the moment, nothing in H 405 provides an equivalent level of protection for private sector employees who document unlawful, fraudulent or unsafe activities.
In pushing for an override of the governor’s veto, bill supporters expressed a willingness to continuing working on the law and to make changes if necessary. ( With the veto now overridden, H 405 becomes law so any changes would have to be made in separate legislation.) G.S. 126-85 could be a good starting point if legislators are serious about protecting the ability of private sector employees to report unlawful and dangerous activities without fearing a lawsuit by their employer.