AN ACT Relating to employment; amending RCW 7.06.020; reenacting and amending RCW 36.18.020; and adding a new chapter to Title 49 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The legislature finds that a significant number of the private sector employees in this state are subject to the common law employment doctrine of "terminable at will," and are consequently without any meaningful job security. The legislature further finds that speedy and economical redress for unjust discharge is best achieved by implementation of a system modeled after the arbitration process common to collective bargaining agreements in the private sector.

NEW SECTION. Sec. 2. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Employer" includes any person, persons, partnership, association, or corporation acting as an employer or in the interest of an employer, and that employs eight or more persons in the state of Washington.

(2) "Employee" includes any person employed on the effective date of this act, or hired thereafter, who has been employed by the same employer, including any predecessor in interest, for a period of three years except:

(a) Workers who work for an employer fewer than one hundred twenty days per year;

(b) Any person whose terms and conditions of employment, including those relating to discharge, are governed by statute, administrative regulation, union contract, or any private employment agreement as defined in this chapter;

(c) Any person who has an ownership interest in the business of the employer other than an employee stock plan, profit sharing plan, or similar employee benefit; and

(d) Any person employed by his or her parent, spouse, or child.

(3) "Private employment agreement" includes any written employment contract, employee handbook or manual, or similar document, that is established by the employer, whether or not subject to negotiation, and that has been provided by the employer to the employee with the expectation that the employee will rely on such agreement as the basis for the terms and conditions of employment, as long as the private employment agreement requires "just cause" for discharge and contains procedures culminating in impartial, final, and binding arbitration, with remedies similar to those provided for in this chapter.

(4) "Just cause" means a sufficient reason, judged by a standard of reasonableness, for the employer's decision. The law developed in the industrial relations area and, to the extent applicable, in the public employment cases in this state should be considered by the arbitrator in applying this standard to the various fact patterns: PROVIDED, That where an employee's position is managerial in nature and either is one primarily characterized as being confidential, or one which principally involves policy-making responsibilities, just cause shall be determined on the basis of whether such discharge is "arbitrary and capricious."

(5) "Discharge" includes (a) dismissal, (b) termination, (c) suspension without pay that is either indefinite in length or in excess of thirty work days, (d) lay-off, or (e) refusal to rehire or recall unless the employee was discharged for just cause or voluntarily quit.

NEW SECTION. Sec. 3. (1) An employer shall not discharge an employee without just cause. Any employee discharged without just cause shall have a remedy under this chapter.

(2) In any discharge based solely on economic reasons, review of the employer's decision, including any managerial determination regarding budgetary matters or allocation of resources, is limited to whether the employer's decision is arbitrary and capricious. Notwithstanding any other provision of this chapter, the employee shall have the burden of proof regarding whether the employer's decision was arbitrary and capricious.

NEW SECTION. Sec. 4. Any employee who is laid off solely for economic reasons shall have a preferential right of rehire if a comparable position becomes available with the employer within one year and the employee has a current application on file with the employer. If more than one employee is involved, the priority for rehiring shall be by seniority unless another method is prescribed by a private employment agreement in effect at the time of the layoff. Any former employee not rehired in accordance with this section may appeal in the manner provided for appeal of any discharge under this chapter. Such an appeal must be commenced within sixty days of the employer's refusal to rehire.

NEW SECTION. Sec. 5. Any discharged employee may appeal the employer's discharge decision within sixty days after receiving written notice of the same. No appeal period begins to run absent such written notice, but no appeal may be initiated by a discharged employee later than one hundred eighty days after the date of his or her discharge. The appeal shall be initiated by the execution of a "petition for arbitration of discharge" on a form available from the superior court, and the filing of the petition with the superior court in the county where the employee principally performs services for the employer. The county clerk shall provide the employer with two copies of the petition by certified mail, return receipt requested, one directed to the individual who discharged the employee as named in the petition, and the second copy directed to the employer at the address set forth in the petition.

NEW SECTION. Sec. 6. (1) Upon the timely filing and service of a petition for arbitration of discharge the superior court shall assign the petition to an arbitrator. In those counties adopting mandatory arbitration under chapter 7.06 RCW, the arbitrator shall be assigned and thereafter conduct an arbitration in a manner consistent with the superior court mandatory arbitration rules and chapter 7.06 RCW, except as otherwise provided in this chapter. In those counties not adopting mandatory arbitration under chapter 7.06 RCW, an arbitrator shall be assigned by the superior court and shall conduct an arbitration in a manner consistent with the superior court mandatory arbitration rules, as if they were otherwise in effect in that county. Any arbitration award under this chapter is final and binding, and subject to challenge only in the manner provided for in chapter 7.04 RCW.

(2) Any motion to vacate an award in accordance with RCW 7.04.160 shall be served and filed no later than sixty days after the arbitrator's award is filed of record with the superior court and served upon the employer and employee.

(3) If no motion to vacate has been served and filed within sixty days after the arbitrator's award is served and filed as set forth in subsection (2) of this section, the clerk of the court shall enter judgment which shall have the same force and effect as judgments in civil actions.

NEW SECTION. Sec. 7. In any arbitration conducted under this chapter:

(1) The employer shall have the burden of proving by a preponderance of the evidence "just cause" for the discharge; and

(2) The employee shall have the burden of proving, by a preponderance of the evidence, the appropriate damages or relief. The burden of proving entitlement to back pay shall include proof that the employee has made a good faith effort to obtain other employment.

NEW SECTION. Sec. 8. (1) The arbitrator may award relief as follows:

(a) Compensation for all economic loss proximately related to the discharge of the employee, including future economic loss; and

(b) Reinstatement to employment, in lieu of future lost wages, if the arbitrator finds reinstatement will not substantially impair the employer's ability to conduct its business.

(2) In any arbitration in which the employee is not awarded reinstatement, the employee may not be awarded future lost wages in excess of three years from the date of discharge.

NEW SECTION. Sec. 9. (1) Every person employed by another shall have the following rights:

(a) To disclose any activity, policy, or practice of his or her employer that is in violation of law, rule, or regulation that the employee in good faith believes presents a substantial risk to the public health, safety, or fiscal integrity;

(b) To provide information to, or testify before, any public body conducting an investigation, hearing, or inquiry into an alleged violation of law, rule, or regulation by his or her employer;

(c) To object to, or refuse to participate in, any such activity which is in violation of a law, rule, or regulation; and

(d) To make a claim for benefits that arise out of the employment relationship.

(2) No person who employs another shall discharge, suspend, demote, refuse to rehire, or otherwise retaliate against an employee who, in good faith, exercises any of the rights in subsection (1) of this section.

(3) Any person who is retaliated against for assertion of the rights set forth in this chapter shall also have a civil action for actual damages, injunctive relief where appropriate, and, if the prevailing party, reasonable attorneys' fees.

NEW SECTION. Sec. 10. Nothing in this chapter prohibits a claim for relief authorized by statute, or any common law claim for libel or slander, outrage, invasion of privacy, or for any intentional tort recognized under the common law committed during the course of, or arising out of, the employment relationship. Nothing in this chapter prohibits any action relating to any issue, other than discharge, based upon a written or oral contract.

NEW SECTION. Sec. 11. The superior courts of the counties of this state shall maintain a sufficient number of forms for a "petition for arbitration of discharge." This petition shall include on the back, the text of sections 2 and 4 of this act, and each court shall have a copy of this chapter available for public inspection. The petition shall be in a form as follows:

@lb SUPERIOR COURT FOR THE COUNTY OF!SC ,1!SC_,10

!tn1 In re!sc ,1@be!sc ,3(Name of Employee)!sc ,3@ee!sc ,1 !tl)!sc ,2CIVIL ARBITRATION NO.!w_

!tl)

!tl)!sc ,2PETITION FOR ARBITRATION OF

!sc ,10Employee !tl)!sc ,2DISCHARGE/REFUSAL TO REHIRE

!w_ !tl)

1. I, !sc_,10, believe I was discharged/not rehired without just cause, as those terms are defined in the "Fair Employment Act."

2. I was employed by!sc ,1@be!sc ,003(Name of Employer)!sc ,003@ee, employer, located at!sc ,1@be!sc ,003(Business Address)!sc ,003@ee, for ___ years, ___ months.

I performed services for my employer principally within !sc_,10 County, Washington. I believe this employer employs 8 or more persons within the State of Washington.

3. I received ___ oral ___ written notice of discharge/refusal to rehire on!sc ,1@be!sc ,003(Date)!sc ,003@ee. The effective date of my discharge was !sc_,5 .

The person who discharged/refused to rehire me was!sc ,1@be!sc ,003(Name and Title)!sc ,003@ee, whose business address is !w_ .

4. I hereby request arbitration in accord with the provisions of the Fair Employment Act.

!tn1 !tl!w_

!tlSignature of Employee

!tlor Legal Representative

!tl!w_

!tlAddress

!tl!w_

!tlTelephone Number

!tl!w_

!tlEmployee's Social Security Number

@la !ixUpon the filing of a petition by the employee or the employee's legal representative, the superior court shall mail copies of the petition to the employer as specified in this chapter, and provide a copy to the superior court for initiation of arbitration proceedings. The filing fee for a petition shall be thirty-five dollars. No other papers associated with the arbitration shall be filed with the court other than notices of appearance, any notices or rulings related to docketing of the arbitration, and the arbitrator's award.

NEW SECTION. Sec. 12. Every employer shall post a copy or copies of this chapter on the employer's premises in a manner so as to be freely accessible to employees.

NEW SECTION. Sec. 13. No determination of fact or law contained in a decision or award under this chapter may be preclusive in any other action or proceeding. A finding of fact or conclusion of law contained in a decision of an administrative law judge, appeal board, or court, obtained under Title 50 or 51 RCW shall not be preclusive in an action under this chapter.

NEW SECTION. Sec. 14. This chapter shall be known as the fair employment act.

Sec. 15. Section 2, chapter 103, Laws of 1979 as last amended by section 3, chapter 265, Laws of 1985 and RCW 7.06.020 are each amended to read as follows:

(1) All civil actions, except for appeals from municipal or justice courts, which are at issue in the superior court in counties which have authorized arbitration, where the sole relief sought is a money judgment, and where no party asserts a claim in excess of ten thousand dollars, or if approved by the superior court of a county by two-thirds or greater vote of the judges thereof, up to twenty-five thousand dollars, exclusive of interest and costs, are subject to mandatory arbitration.

(2) If approved by majority vote of the superior court judges of a county which has authorized arbitration, all civil actions which are at issue in the superior court in which the sole relief sought is the establishment, termination or modification of maintenance or child support payments are subject to mandatory arbitration. The arbitrability of any such action shall not be affected by the amount or number of payments involved.

(3) All petitions for arbitration of discharge under chapter 49.-- RCW (sections 1 through 14 of this 1987 act) in counties that have mandatory arbitration are subject to mandatory arbitration.

Sec. 16. Section 1, chapter 38, Laws of 1973 as last amended by section 104, chapter 7, Laws of 1985 and by section 1, chapter 24, Laws of 1985 and RCW 36.18.020 are each reenacted and amended to read as follows:

Clerks of superior courts shall collect the following fees for their official services:

(1) The party filing the first or initial paper in any civil action, including an action for restitution, or change of name, shall pay, at the time said paper is filed, a fee of seventy dollars except in proceedings filed under RCW 26.50.030 where the petitioner shall pay a filing fee of twenty dollars.

(2) Any party filing the first or initial paper on an appeal from justice court or on any civil appeal, shall pay, when said paper is filed, a fee of seventy dollars.

(3) The party filing a transcript or abstract of judgment or verdict from a United States court held in this state, or from the superior court of another county or from a justice court in the county of issuance, shall pay at the time of filing, a fee of fifteen dollars.

(4) For the filing of a tax warrant by the department of revenue of the state of Washington, a fee of five dollars shall be paid.

(5) The party filing a demand for jury of six in a civil action, shall pay, at the time of filing, a fee of twenty-five dollars; if the demand is for a jury of twelve the fee shall be fifty dollars. If, after the party files a demand for a jury of six and pays the required fee, any other party to the action requests a jury of twelve, an additional twenty-five dollar fee will be required of the party demanding the increased number of jurors.

(6) For filing any paper, not related to or a part of any proceeding, civil or criminal, or any probate matter, required or permitted to be filed in his office for which no other charge is provided by law, or for filing a petition, written agreement, or memorandum as provided in RCW 11.96.170, the clerk shall collect two dollars.

(7) For preparing, transcribing or certifying any instrument on file or of record in his office, with or without seal, for the first page or portion thereof, a fee of two dollars, and for each additional page or portion thereof, a fee of one dollar. For authenticating or exemplifying any instrument, a fee of one dollar for each additional seal affixed.

(8) For executing a certificate, with or without a seal, a fee of two dollars shall be charged.

(9) For each garnishee defendant named in an affidavit for garnishment and for each writ of attachment, a fee of five dollars shall be charged.

(10) For approving a bond, including justification thereon, in other than civil actions and probate proceedings, a fee of two dollars shall be charged.

(11) In probate proceedings, the party instituting such proceedings, shall pay at the time of filing the first paper therein, a fee of seventy dollars: PROVIDED, HOWEVER, A fee of two dollars shall be charged for filing a will only, when no probate of the will is contemplated. Except as provided for in subsection (12) of this section a fee of two dollars shall be charged for filing a petition, written agreement, or memorandum as provided in RCW 11.96.170.

(12) For filing any petition to contest a will admitted to probate or a petition to admit a will which has been rejected, or a petition objecting to a written agreement or memorandum as provided in RCW 11.96.170, there shall be paid a fee of seventy dollars.

(13) For the issuance of each certificate of qualification and each certified copy of letters of administration, letters testamentary or letters of guardianship there shall be a fee of two dollars.

(14) For the preparation of a passport application there shall be a fee of four dollars.

(15) For searching records for which a written report is issued there shall be a fee of eight dollars per hour.

(16) Upon conviction or plea of guilty or upon failure to prosecute his appeal from a lower court as provided by law, a defendant in a criminal case shall be liable for a fee of seventy dollars.

(17) For filing a petition for arbitration of discharge or refusal to rehire, there shall be a fee of thirty-five dollars.

(18) With the exception of demands for jury hereafter made and garnishments hereafter issued, civil actions and probate proceedings filed prior to midnight, July 1, 1972, shall be completed and governed by the fee schedule in effect as of January 1, 1972: PROVIDED, That no fee shall be assessed if an order of dismissal on the clerk's record be filed as provided by rule of the supreme court.

((~~(18)~~)) (19) No fee shall be collected when a petition for relinquishment of parental rights is filed pursuant to RCW 26.33.080 or for forms and instructional brochures provided under RCW 26.50.030.

NEW SECTION. Sec. 17. Sections 1 through 14 of this act shall constitute a new chapter in Title 49 RCW.

NEW SECTION. Sec. 18. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.