CalEmployeeRights

Welcome to CalEmployeeRights.com

CalEmployeeRights.com is the premier weblawg devoted to California wrongful termination, discrimination, harassment and retaliation law from the perspective of the employee.  We hope you enjoy your visit here and that you learn something about this important and fast-changing area of California law.  The primary authors of posts in this blawg are Bruce Nye, David Becht and Michael Sachs.  We are all lawyers with Adams Nye Trapani Becht LLP in San Francisco.  We represent executives, managers and other employees in employment litigation, and you can read more about our practice here.

Attorneys' Fees to Employees in Contract Cases

       As noted previously here, it appears that California courts are becoming more liberal in granting attorney fees in employment cases, specifically contract cases.  As we discussed, in the case of Otay River Constructors v. San Diego Expressway (2008) 158 Cal.App.4th 796,  the court held that a plaintiff who successfully opposed a motion to compel arbitration was entitled to attorney fees.

        Now, in the case of Profit Concepts Management, Inc. v. Griffith (2008) ___ Cal. App. 4th ___ (Fourth Appellate Dist., No. G039077)  the court held that a former employee who was dismissed from a suit for lack of jurisdiction was the prevailing party and thus entitled to attorney fees under the employment contract.

        Greg Griffith, a resident of Oklahoma, was a former employee of Profit Concepts.  A portion of his employment contract contained a provision stating that if Profit Concepts was the successful litigant in an action to enforce the terms of or an action resulting from the contract it was entitled to attorney fees.  Under Civil Code §1717  this unilateral right to receive fees became reciprocal.

        Following an employment dispute, Profit Concepts Management sued in California court for, among other things, breach of contract.

        Griffith moved to quash service of a summons for lack of personal jurisdiction.  Profit Concepts did not oppose this motion, and the motion was granted.  Griffith then moved for an award of attorney fees under the contract.  The trial court granted this motion as well.  Profit Concepts appealed.

        The Court of Appeals upheld the grant of attorney fees.  The Court reasoned that under CCP §1032(a)(4),  when a party receives other than monetary relief, the trial court can determine who is the prevailing party.  The trial court had found Griffith the prevailing party, so he was entitled to attorney fees under the contract.

                                                                     -- Michael Sachs

Cal Supremes Clarify California Family Rights Act

California law, like the Federal law, protects the rights of an employee with a “serious health condition” that makes the employee “unable to perform the functions” of his or her job.  The California Family Rights Act, or CFRA (Gov. Code sections 12945.1, 12945.2) allows eligible employees twelve weeks of unpaid leave and continuance of health benefits.

Like the Federal act, the CFRA provides that an employer who disputes a physician’s finding of an employee’s right to leave can, at its own expense, seek a second opinion from a physician of its choosing.  If that does not resolve the dispute, the employer may arrange for a third examination, also at its expense, by a physician agreed to by both employer and employee.  The determination of the third physician is binding on employee and employer.

In Lonicki v. Sutter Health Central (2008) ___Cal.4th___ (S130839), the California Supreme Court made two significant rulings:

• While the employer can get the second and third opinion, it doesn’t have to do so.  If the employer believes the employee is not entitled to leave, it can simply deny the leave request, and discipline or terminate the employee for not coming to work.  Of course, the employee can then sue the employer for damages for violating CFRA, and if the employer is wrong, it will lose the suit.

• If the employee gets another job that is anything other than identical to the job from which the employee is taking leave, this may be strong evidence that the employee is actually able to perform the functions of his or her previous job.  But it isn’t conclusive, and the employee may still be entitled to a jury trial as to whether he or she was entitled to leave.  And under this decision, it sounds like almost no two jobs will ever be identical.

Court of Appeal Upholds Race Discrimination Verdict Against Sybase and Reinstates Punitive Damages Award

   On April 18, 2008, the California Court of Appeal, First District, affirmed a jury’s finding of race and/or gender discrimination against Sybase, Inc. and the compensatory damage award of $1,342,943 to Sybase’s former employee, Marietta Harvey.  The Court of Appeal also reinstated the jury’s punitive damages award of $500,000.  The jury had awarded punitive damages after finding that Sybase’s conduct in terminating Ms. Harvey demonstrated malice, fraud, and/or oppression.  The trial judge had reversed the jury’s punitive damage award, but the Court of Appeal ruled that the trial court’s action doing so was erroneous.  The case is Harvey v. Sybase, Inc. (2008) ___ Cal.App.4th ___ (A109300).

    Marietta Harvey, the plaintiff, was originally from the Phillippines.  She worked in the Human Resources Department of Sybase, Inc. beginning in 1999.  She rose to become the only “Group Director” in Human Resources, second in command to Nita White Ivy (also from the Phillippines), the Vice President of Human Resources. She received consistently exceptional job reviews over the years.   In February of 2003, for reasons unclear to Ms. Harvey, she was fired from Sybase, Inc. 

    The case was tried to a jury in the fall of 2004.  After hearing evidence at trial that Sybase’s CEO had commented that the Human Resources Department  “looked like an airport,” and that Ms. White-Ivy had repeatedly stated that her department needed more white males, the jury found that Ms. Harvey’s termination was motivated by race or gender discrimination in violation of California law.  In ruling on appeals by both Sybase and Ms. Harvey, the Court of Appeal held that this evidence was sufficient to support both the compensatory award for lost earnings and the punitive damage award based on malice.

    Ms. Harvey was represented at trial by David J. Becht and Barbara R. Adams of Adams ∣ Nye ∣ Trapani ∣ Becht  LLP and on appeal by Bruce Nye, also of this firm.

P.S.:  More coverage for this decision at the excellent Horwitz and Levy Blawg, California Punitive Damages, an Exemplary Blog.

"Lobstergate" Retaliation Verdict vs. City of Long Beach

The recent Verdictsearch California (subscription req'd) reports a $4.1 million verdict by three Long Beach police officers against the City of Long Beach for retaliation.  CBS2.com also has coverage.

Seems that some of Long Beach's finest went illegally lobster diving on city time.  The plaintiff officers reported it.  They were called "snitches," denied job opportunities, had tires punctured, had feces smeared on a locker room towel, bullets stolen, etc.  One officer was forced into early disability retirement.

The Long Beach Press-Telegram reported in August, 2007 that the parties had mediated a settlement of $1.95 million, but the city counsel rejected it.  The jury found unlawful retaliation, and awarded compensatory damages to the three plaintiffs ranging from $1.16 million to $1.56 million.

                                                          Bruce Nye

Supremes Decide Jones v. Lodge at Torrey Pines

The California Supreme Court has decided in Jones v. Torrey Pines (2008) ___ Cal.4th ___ (S151022) that non-employer individuals cannot be held liable for retaliation.  The applicable part of the FEHA, Government Code section 12940(h) makes it unlawful for "any employer, labor organization, employment agency, or person to discharge, expel, or otherwise discriminate against any person because that person has filed a complaint, testified, or assisted in any proceeding" under FEHA.  Two California courts of appeal and the Ninth Circuit have all held that this language is unambiguous and means what it says:  an individual may not retaliate against a person who exercises FEHA rights, and can be held liable if he or she does.  Taylor v. City of Los Angeles Dept. of Water & Power (2006) 144 Cal.App.4th 1216;  Walrath v. Sprinkel (2002) 99 Cal.App.4th 1237;  Winarto v. Toshiba America Electronics Components (9th Cir. 2001) 274 F.3d 1276.

Not so, said the Supreme Court:  the use of the term "person" is ambiguous, and the Court therefore goes through an extensive amount of "interpretation" to render the word surplusage to support its holding. In an  impassioned and very well-reasoned dissent, Justice Moreno (joined by Justices Werdegar and Kennard) assails the Court for implementing its own views of public policy and incentivizing supervisors who harass to also retaliate against employees who oppose the harassment in an effort to dissuade their victims from reporting the conduct. 

The majority argues that it is only addressing retaliation for complaining of discrimination, not harassment (fn. 4) and that it is not expressing an opinion as to whether retaliation for complaining of harassment makes a supervisor liable.  So this window remains slightly open.  But as Justice Moreno shows in his dissent (the majority doesn't discuss the facts of the case at all), the complaints which formed the basis for the retaliation clearly related to harassment.

All in all, not a good day for plaintiffs in FEHA retaliation cases.

Wrongful Termination Case Based on Labor Code Section 232.5 is Preempted by NLRA

California has two statutes, Labor Code sections 232 and 232.5, that protect the rights of employees to disclose information about their compensation or working conditions.  The first, Labor Code section 232, was enacted in 1984, provides:

No employer may do any of the following:

(a) Require, as a condition of employment, that an employee refrain from disclosing the amount of his or her wages.

(b) Require an employee to sign a waiver or other document that purports to deny the employee the right to disclose the amount of his or her wages.

(c) Discharge, formally discipline, or otherwise discriminate against an employee who discloses the amount of his or her wages.

This statute was broadly interpreted by the Court of Appeal in Grant-Burton v. Covenant Care, Inc. (2002) 99 Cal.App.4th 136. There, the court upheld a claim for wrongful termination against public policy after an employee was allegedly terminated for telling co-employees (during an exchange of information between co-employees) that she did not receive a bonus.  The court held that (a) section 232 set forth the public policy of the state protecting employees from adverse employment action for disclosing information about “wages,” and (b) that the statute was intended to protect employees who wanted to discuss “some aspect of their compensation, for example, a possible increase in pay, perceived disparities in pay, or the awarding of bonuses.”

Only months after the court’s Grant Burton decision, the legislature enacted Labor Code section 232.5:

No employer may do any of the following:

(a) Require, as a condition of employment, that an employee refrain from disclosing information about the employer's working conditions.

(b) Require an employee to sign a waiver or other document that purports to deny the employee the right to disclose information about the employer's working conditions.

(c) Discharge, formally discipline, or otherwise discriminate against an employee who discloses information about the employer's working conditions.

(d) This section is not intended to permit an employee to disclose proprietary information, trade secret information, or information that is otherwise subject to a legal privilege without the consent of his or her employer.

In the following six years, no California court has issued a published decision involving section 232.5. . . . . until now.

More after the jump.

Cal Supreme Court Grants Review in Reid v. Google, Inc.

Last October the Sixth District Court of Appeal reversed summary judgment in an age discrimination case in Reid v. Google, Inc.(2007) 155 Cal.App.4th 1342 (now unciteable).  The decision, written by Justice Conrad Rushing, was chock full of all kinds of pro-plaintiff language, and really quite disparaging about the tendency of some courts to evaluate and weigh facts in ruling on summary judgment (a particular problem in the Federal Courts, but something we see in state courts as well).  The decision was particularly scornful of the "stray remark" doctrine, from which employers argue (and a few appellate courts have held) that an employee cannot successfully resist summary judgment with evidence that a supervisor made a "stray remark" manifesting a general unlawful discriminatory bias.  (Example:  Horn v. Cushman & Wakefield Western, Inc. (1999) 72 Cal.App.4th 798, 809.)  As the court observed:

The so-called "stray remarks" rule allows courts to deem racist or sexist remarks insufficient to support denial of summary {Slip Opn. Page 20} judgment if the remarks are considered "stray." We cannot view such a rule as anything other than the assumption by the court of a factfinding role.

The decision also held that, when a party objects to evidence on summary judgment, if the trial court does not explicitly rule, it will be assumed to have decided only on the basis of competent, admissible evidence, following  Biljac Associates v. First Interstate Bank (1990) 218 Cal.App.3d 1410 and declining to follow the more recent contrary ruling in Demps v. San Francisco Housing Authority (2007) ___ Cal.App.4th ___.

The Supremes have now granted a hearing, thus wiping the case off the books.  The statement of issues on review indicates that the Court will resolve the Biljac vs. Demps question, but is going to take a look at the "stray remarks" doctrine for good measure.

How Not to Give References

Most employer's attorneys advise their clients that when an inquiry is made about a former employee, the employer should limit the response to confirming the former employee's dates of employment and job title.  There are two reasons for this: avoiding liability to the prospective employer for misleading information about a problem employee, and avoiding liability to the former employer for defamation.  This is certainly conservative legal advice and probably a good way to avoid litigation risk.

There are also a significant number of employers who consider this advice to be overkill, and who continue to give out information about past employees. Their logic is that the hiring process is a difficult one, and employers should help one another. 

But here's something everybody can agree is a bad idea.  Verdict Search
(Subscription Requ'd) reports on the case of William Dozier v. Lithia Ford of Fresno and Mike Leal, Fresno Superior Court No. 05CECG02456.  The news report from the Fresno Bee also appears at the web site for Oren & Paboojian, who represented Dozier.

This was an arbitrator's decision, not a jury verdict.  Plaintiff was a salesman for Lithia Ford.  He left to take another job.  His former manager faxed posters to his new employer, depicting him as "wanted" for being a traitor and backstabber.  Dozier sued for defamation.

Here's the twist:  Dozier was a Vietnam veteran sniper.  When he was in Vietnam, the Viet Cong circulated wanted posters with his photo on it. He claimed that the posters caused flashbacks to his service time, caused him to start drinking again, and resulted in VA hospitalization.  His alcohol use caused him to lose his job and the family home.

The arbitrator found that the posters were defamatory and all the damages were caused by the defamation.  He awarded $775,000.

                                                                   -- Bruce Nye

Racial Harassment Claims Reported at All Time High

MSNBC reports a record year, and record decade for racial harassment claims to the EEOC:

"Racial harassment cases have more than doubled since the early 1990s, hitting an all-time  high of 6,977 in 2007, according to EEOC data. (Blacks file nine out of 10 race harassment charges.) From fiscal 2000 to 2007, the EEOC received 51,000 racial harassment charge filings nationwide, already over the number received during the entire 1990s."

Of course, that does not include claims under state laws, such as California's Fair Employment and Housing Act (FEHA), nor civil court filings.  We don't have any numbers on these.  But we do know that the race harassment awards in California state court tend to be much higher than agency awards.

                                                                            --- Bruce Nye

Attorneys' Fees For Opposing Motions to Compel Arbitration

California's appellate courts have issued many decisions in the past several years on binding arbitration provisions in consumer and employment contracts, which are typically non-negotiated contracts of adhesion.  In employment cases, employers obviously like arbitration because they think they can get rid of the "high end" of compensatory and punitive damages.  Employee attorneys resist arbitration for the same reason.

But here's a commercial arbitration case (involving negotiated contracts and equal and sophisticated parties) with implications for all disputes over contractual arbitration provisions.

More after the jump.