In McDaniel v. Kavry Management, LLC, the California Court of Appeal considered whether an employer’s requirement that an employee submit to a polygraph test as a condition of continued employment could support a claim for wrongful termination in violation of public policy.
The case arose after approximately $70,000 in marijuana and cash was stolen from the employer’s licensed cannabis cultivation facility in Adelanto, California. Following the incident, the employer required several employees—including the plaintiff, Steven McDaniel—to take a polygraph test. According to McDaniel, he believed taking the test was mandatory and that he would be fired if he refused. The employer did not inform him that he had the right to decline the test. McDaniel took the polygraph examination twice, failed both times, and was subsequently terminated.
McDaniel later filed suit asserting several claims, including wrongful termination in violation of public policy and violations of California Labor Code section 432.2, which prohibits employers from requiring employees to submit to polygraph or lie detector tests as a condition of employment or continued employment.
At trial, a jury awarded McDaniel $100,000 in noneconomic damages, finding that the employer violated the statutory prohibition against compelled polygraph testing. The employer appealed the judgment.
The Court of Appeal affirmed in part and reversed in part. The court held that requiring an employee to submit to a polygraph test as a condition of continued employment violates Labor Code section 432.2 and can support a claim for wrongful termination in violation of public policy. However, the court reversed the award of attorney’s fees under Labor Code section 432.6 because the statute did not apply retroactively to the plaintiff’s employment.
The case was remanded to the trial court for further proceedings consistent with the appellate court’s ruling.
