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The Indiana Workmen's Compensation Act creates a duty in the employer to compensate employees for work-related injuries and a right in the employee to receive such compensation. But in order for the goals of the Act to be realized and for public policy to be effectuated, the employee must be able to exercise his right in an unfettered fashion without being subject to reprisal. If employers are permitted to penalize employees for filing workmen's compensation claims, a most important public policy will be undermined. The fear of being discharged would have a deleterious effect on the exercise of a statutory right. Employees will not file claims for justly deserved compensation, opting, instead, to continue their employment without incident. The end result, of course, is that the employer is effectively relieved of his obligation. Since the Act embraces such a fundamental, well-defined and well-established policy, strict employer adherence is required.
The employee, Dorothy Frampton, injured her arm while working. Frampton’s employer then, Central Indiana Gas Company, and their insurer paid her hospital and medical expenses, as well as her full salary, during the four months she was unable to work. However, they did not inform her of further benefits that might have been available. When she did return to the job she performed capably. Approximately 19 months after the injury, Central Indiana and its insurer were notified of a 30 per cent loss in the use of her arm. Although hesitant to file a claim for fear of losing her job she did so, and received a settlement for her injury. About one month later she was discharged from her employment without reason being given. Frampton brought an action against Central Indiana seeking actual and punitive damages for retaliatory discharge. The Henry Circuit Court dismissed the complaint for failure to state a claim. Frampton appealed. The First District Court of Appeals affirmed the trial court's dismissal.
Did the court of appeals err in affirming the decision of the circuit court dismissing Frampton’s claim pursuant to Indiana's Workmen's Compensation statutes for failure to state a claim?
The court declared that an employee who alleged that he or she was retaliatorily discharged for filing a claim pursuant to the Indiana Workmen's Compensation Act, Ind. Code § 22-3-2-1 et seq. (1971), or the Indiana Workmen's Occupational Diseases Act, Ind. Code § 22-3-7-1 et seq. (1971), stated a claim upon which relief could be granted. While agreeing with the lower court that, under ordinary circumstances, an employee-at-will could be discharged without cause, the court held that an exception to the general rule had to be recognized when an employee was discharged solely for exercising a statutorily conferred right.