Supreme Court of Virginia Upholds Sovereign Immunity and Fortifies At-Will Employment Doctrine

On June 2, 2016, the Supreme Court of Virginia decided two important cases for local governments and employers.  George Somerville, of Harman Claytor, filed amicus briefs in support of the prevailing parties – one upholding a plea of public employee sovereign immunity and the other rejecting an argument that an employer must provide an employee advance notice of termination.

In Pike v. Hagaman, Record No. 151193, the Supreme Court held that a nurse employed by VCU was entitled to sovereign immunity.  The defendant, Hagaman, is a nurse in the Surgical Trauma Intensive Care Unit at VCU Medical Center.  The plaintiff “underwent a complex and lengthy surgery lasting over 12 hours to reconstruct his hard and soft rear palates, i.e., the back of his mouth.”  He alleged that Hagaman negligently failed to keep his head in an upright position during his post-surgical care, interrupting blood flow to the site, and causing the palate reconstruction surgery to fail.  Hagaman filed a plea of sovereign immunity, which the Richmond Circuit Court (Judge Gregory L. Rupe) reluctantly sustained, stating that “the Court is troubled that a nurse in a private hospital across the street from a state-run hospital, faced with the same allegations of negligence as Hagaman, would be unable to enjoy the protection of sovereign immunity merely because they work in a different building.”

The Supreme Court affirmed, confirming once again that “[T]he doctrine of sovereign immunity remains ‘alive and well in Virginia.'”  It applied (as Judge Rupe did) the four-factor test announced in James v. Jane, 221 Va. 43, 53, 282 S.E.2d 864, 869 (1980).  In an opinion by Justice McCullough, the Court held that the nurse was performing an essential governmental function (as stated by statute, Code § 23-50.16:2); that the evidence confirmed that she was performing “acts of judgment and discretion which [we]re necessary to the performance of the governmental function”; and that the hospital “had a high degree of control over Hagaman, who was supervised by more senior nursing staff” and subject to the hospital’s policies, scheduling, and payment of wages.

In Johnston v. William E. Wood & Associates, Inc., Record No. 151160, the Supreme Court reiterated that an employer does not need to give notice when terminating an employee.  In doing so, the Court addressed the meaning of its statement in Stonega Coal & Coke Co. v. Louisville & Nashville R.R. Co., 106 Va. 223, 226, 55 S.E. 551, 552 (1906), “that when an employment contract does not specify a time period for its duration, ‘either party is ordinarily at liberty to terminate it at-will on giving reasonable notice of his intention to do so.'”  (Emphasis added by the Court.)  Johnston argued that “reasonable notice” includes a temporal component, i.e., that the notice “must be provided at some reasonable time before the termination of the employment relationship.”  The Court rejected her argument, resolving a deep conflict among circuit courts and federal district courts in Virginia.  The Supreme Court held “that the phrase ‘reasonable notice’ simply means effective [or “effectual”] notice that the employment relationship has ended.”  It also reasoned that “a contrary ruling would create a great deal of uncertainty in employment relations” by making “[e]very decision to terminate an employment relationship, or of an employee to quit a job,” a jury question – “hardly the clear, flexible rule that the at-will doctrine contemplates.”

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