Nonprofits help shape, empower, and strengthen many underserved communities with the aid of donors who believe and trust in the organization’s mission. These goodhearted missions come with accountability to both donors and those served by the organization. A recent opinion by the Eighth Circuit Court of Appeals in Chavez-Lavagnino v. Motivation Education Training, Inc. reminds nonprofits that they are not only subject to whistleblower laws, but their actions will be scrutinized in conjunction with their heightened responsibility to the community and governments that support them.
In Chavez-Lavagnino, the plaintiffs claimed that their employer, nonprofit Motivation Education Training, Inc. (“MET”), “terminated them in violation of Minnesota law for refusing to participate in MET's attempts to defraud the federal government.” MET defended in four ways: (1) MET did not direct the plaintiffs to violate federal law; (2) MET attempted to rehire one of the plaintiffs shortly after her termination; (3) plaintiffs could not prove their refusal to follow allegedly unlawful directions caused their terminations; and (4) plaintiffs’ supervisor could not be held personally liable for their firing.
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