July 15, 2014

A "Split Decision": California Supreme Court Addresses Arbitration Agreements and Gives Some Good News (But Mostly Bad News) to Employees

In the Iskanian v.CLS Transportation Los Angeles, LLC decision, the California Supreme Court addressed the enforceability of employer-employee arbitration agreements in various circumstances. Iskanian v.CLS Transportation Los Angeles, LLC, --- Cal.4th ----, 2014 WL 2808963 (June 23, 2014). The case delivered some good news - but mostly bad news - for employees and attorneys who represent employees.

First, as to the bad news: Boxed in by the United States Supreme Court's decisions on the enforceability of arbitration agreements, including in AT&T Mobility LLC v. Concepcion, 131 S.Ct. 1740 (2001), the California Supreme Court upheld the validity of class action waivers in employment arbitration agreements. The California Supreme Court overruled its previous decision in Gentry v. The Superior Court of Los Angeles, 42 Cal.4th 443 (2007) as preempted by the Federal Arbitration Act ("FAA").

The California Supreme Court also addressed the recently developed and powerful argument that class action arbitration waivers are invalid under the National Labor Relations Act ("NLRA"), which provides workers with a right to collective organize and advocate for their rights as a group. That argument gained traction with the National Labor Relations Board ("NLRB") in its recent decision in D.R. Horton. Inc., 357 NLRB No. 184 (2012), but unfortunately the California Supreme Court sided with the Fifth Circuit's contrary opinion in D.R. Horton, Inc. v. NLRB, 737 F.3d 344 (5th Cir. 2013). The California Supreme Court held that the NLRA was no obstacle to the applicability of the FAA to support the enforcement of class action waivers in arbitration agreements.

There is a silver lining to every cloud, and the Court's decision in Iskanian provided one. The Court held that an employer-employee arbitration agreement cannot provide for a waiver of employees' rights to undertake a representative action under the California Private Attorneys General Act ("PAGA"), as that would violate public policy. The Court held that the FAA did not mandate a contrary result, while explaining that "a single-claimant arbitration under the PAGA for individual penalties will not result in the penalties contemplated under the PAGA to punish and deter employer practices that violate the rights of numerous employees under the Labor Code. That plaintiff and other employees might be able to bring individual claims for Labor Code violations in separate arbitrations does not serve the purpose of the PAGA, even if an individual claim has collateral estoppel effects." In so holding, the Court also explained that PAGA does not violate the principle of separation of power under the California Constitution.

There are several interesting things to think about moving forward after this case. As an initial matter, it remains to be seen as to whether this will result in employers inserting more arbitration agreements in employment contracts and handbooks. The reason is that, although the United States and California Supreme Courts have made it easier for employers to do so, employers still need to be careful for what they wish for. Experience has demonstrated that arbitrations are costly for the employer, and they don't always come out the way the employer expects it to. For example, our firm has had excellent outcomes in arbitrations, including seven figure awards and awards of punitive damages.

Moreover, while Iskanian gives employers a new stick to enforce certain arbitration agreements, employees and their advocates faced with an arbitration agreement should not give up and lose hope because (1) arbitration agreements are still subject to challenge on unconscionability grounds (Iskanian did not change that), (2) PAGA provides at least some stick to enable employees to enforce their rights in "representative" actions, and (3) there are positive sides to an arbitration agreement. There is a positive side to arbitration agreements for employees because the employer generally has to pay the arbitrator's costs if the employee wins, there is no real appeal so the employer has to pay up quickly, and the arbitration can be quicker and less expensive for the employee.

We also all need to keep tabs on whether the U.S. Supreme Court decides to hear this case to address its holdings.

July 15, 2014
Benjamin Siegel

July 7, 2014

Supreme Court Bears Good News for Whistleblowers

In Thursday's unanimous Lane v. Franks decision, the Supreme Court decided that public employees are protected from retaliation when they testify in court about misconduct they observe on the job. Lane v. Franks, No. 13-483 (June 19, 2014).

Edward Lane was a director of a program for underprivileged youth operated by Central Alabama Community College (CACC). As the director, he conducted an audit of the program's expenses and found that an Alabama State Representative, Susan Schmitz, was on the payroll even though she was not doing any work for the program! Mr. Lane terminated Ms. Schmitz's employment and soon thereafter, Ms. Schmitz was indicted on mail fraud and theft charges. Mr. Lane testified against Ms. Schmitz about why he fired Ms. Schmitz and Ms. Schmitz was ultimately convicted.

After he testified, Mr. Lane, along with 28 other employees were terminated. But a few days later, CACC's president Steve Franks hired back everyone other than Mr. Lane and one other employee. Mr. Lane filed a lawsuit claiming that Mr. Franks had violated his First Amendment rights by firing him in retaliation for testifying against Ms. Schmitz.

Prior cases have called into question when First Amendment protections apply to public employees. In determining whether a public employee is protected under the First Amendment, courts first determine whether the employee spoke as a "citizen" on "a matter of public concern." It was not Mr. Lane's job to testify against Ms. Schmitz - he merely learned about the corruption she was involved in through his job. The Court rightly determined that testimony in a court proceeding is a "quintessential example of citizen speech." The Court also decided that Mr. Lane's testimony about "corruption in a public program and misuse of state funds" was clearly a matter of public concern. Finally, the Court decided that the CACC did not have any justification for treating Mr. Lane differently.

The Supreme Court's ruling means that public employees who witness corruption at work will no longer be in the "impossible position" of being "torn between the obligation to testify truthfully and the desire to avoid retaliation and keep their jobs." Now public employees who learn about corruption or criminal activity on the job and testify about that unlawful conduct are still protected by the First Amendment. Even though this case applies specifically to First Amendment protections for public employees, the Court emphasized the importance of whistleblowing and the value of encouraging this type of speech which will likely have ramifications for both public and private sector employees.

This is a win for public employees and the public at large who have a shared interest in exposing corruption in government.

July 7, 2014
Jean Krasilnikoff

June 27, 2014

State Public Policy Claim Against Airline Preempted Because the Federal Aviation Act Occupies the Field of Aviation Safety

As Mr. Ventress learned the hard way - after three trips to the Ninth Circuit - it is tough to sue an airline for safety violations and/or termination for reporting safety violations.

Mr. Ventress claimed he was retaliated against as a flight engineer because he reported safety concerns. The case took three trips to the Ninth Circuit. In the first appeal, Ventress v. Japan Airlines (Ventress I) , 486 F. 3d 1111 (2007), the Ninth Circuit held that the Friendship Commerce and Navigation Treaty did not bar or preempt Mr. Ventress' claims. In the second trip to the Ninth Circuit, it held that the Airline Deregulation Act did not bar or preempt Mr. Ventress' claims. Ventress v. Japan Airlines (Ventress II), 603 F.3d. 676 (2010).

However, Mr. Ventress wasn't so lucky on his third journey to the Ninth Circuit, which held that Mr. Ventress' public policy/safety claims were barred by the Federal Aviation Act (FAA). The Court held that the claims would require the jury to decide safety questions that are governed by the FAA which occupies the field of aviation safety. Ventress v. Japan Airlines (Ventress III) 747 F.3d 716 (2014).

Although not a good outcome for Mr. Ventress, this is a fairly unique outcome limited to industries whose safety is carefully and extensively regulated by the federal government, such as the airline industry. Others should not be deterred from bringing state law public policy claims if, for example, fired for reporting a safety or other public policy concern.

June 27, 2014
Jody LeWitter
Public Policy

June 23, 2014

Same-Sex Harassment and Retaliation Case Reinstated by Court of Appeals

In good news for victims of sex harassment and retaliation, and especially for same-sex victims, Lewis v. City of Benicia, 224 Cal.App.4th 1519 (2014) reinstated many of the claims against the City of Benicia and one of its supervisors.

First, the California Court of Appeals made clear that the trial court overstepped its bounds when it dismissed a sexual harassment claim. Following the U.S. Supreme Court opinion in Oncale v. Sundowner Offshore Services, Inc., 523 U.S. 75 (1998), the court held that same-sex harassment which included sexual comments intended to humiliate the plaintiff due to his gender identity constituted sexual harassment. It reversed the lower court's ruling that the harassing conduct was not sufficiently "severe or pervasive" to constitute sexual harassment. It found that several months of a course of conduct of gifts and lunch purchases, sexual jokes, and pornographic computer images, was sufficient to bring a claim for sexual harassment.

On the other hand, the Court of Appeals dismissed a sexual harassment claim against another supervisor whose only conduct was showing computer pornography to a group of employees once or twice, and making an occasional joke.

Lewis also addressed a thorny evidentiary issue: in a retaliation claim, should a judge admit or exclude evidence of the underlying harassment where plaintiff's claim is that he/she complained about the harassment and was retaliated against for making the complaint? In the Lewis case, the lower court held that the evidence of the harassment itself was not admissible. Instead, the court simply read a statement about the harassment. The Court of Appeals found this to be error. In other words, the jury needs to understand and be presented with the underlying conduct about which the plaintiff complains in order for the jury to rule on a retaliation complaint.

All this is good news for plaintiffs in sexual harassment or retaliation claims. And stay tuned, because the California Court of Appeals specifically did not address recent amendments to the Fair Employment and Housing Act which specifies that "...sexual harassment conduct need not be motivated by sexual desire." Govt Code 12940(j)(4)(c). Certainly future cases interpreting this new provision should be helpful.

June 23, 2014
Jody LeWitter

June 13, 2014

U.S. Supreme Court Rules That Severance Payments are Taxable Wages

On March 25, 2014, the U.S. Supreme Court held that severance payments provided to a terminated employee are taxable. U.S. v. Quality Stores, Inc. 134 S.Ct. 1395 (2014). This case involved severance payments to employees laid off before and during bankruptcy proceedings. The size of the payments were determined by job security and length of employment. Given this case, most "severance payments" will be construed as taxable wages, wherein an employer should issue a W-2 and withhold taxes.

However, there certainly may be situations in which payments received from an employer at or around termination - at least some of the payment - may not be taxable wages. For example, if an employee is provided payment in lieu of a pending or possible discrimination claim, this payment certainly might contemplate payments for some combination of lost wages, emotional distress and/or attorney's fees. What the payment is actually intended to cover may vary in each situation. Thus, it is important to look at the underlying nature of the payment in order to determine whether a payment is taxable wages. And, as a precaution, it is important to clarify what the payment is for - preferably in a writing between the parties.

Alas, it is also important to note that even if a payment is not "taxable wages", there will most likely be taxes that are still due! For example, most emotional distress awards/settlements are taxable, just not taxable as wages. It is best to check with an employment lawyer and/or an accountant about this.


June 13, 2014
Jody LeWitter

January 21, 2014

Invasion of Privacy Claim Established Where Supervisor Blatantly Shares Medical Condition With Co-Workers

There is an employee-with-a-disability's worst nightmare. You suffer from a disability. You try your best to go to work each day despite your disability (which here is a mental disability). Because of the stigma associated with the disability, you keep your medical condition to yourself. When you must miss work due to your disability, you faithfully let your employer know. Because you want your employer to understand that there really is a good reason for your absence, you let your employer know the nature of your disability and that it caused you to miss work. Then, your employer stands up on a chair and screams to the world, including all your co-workers, "Ignat was bipolar!" Ignat v. Yum! Brands, Inc., 214 Cal.App.4th 808 (2013).

As a result of Ignat's supervisor's loose lips, Ms. Ignat's co-workers shun her and ask whether she is going to "go postal". Ms. Ignat sues for invasion of privacy. The employer defends based on a bunch of technicalities. First, it defended the case based on the fact that she filed her legal papers too late. The trial court bought this, but the Court of Appeals reversed. Then it defended claiming you can only state a claim for invasion of privacy if the invasion is done in writing, rather than orally. The lower Court bought this argument, and dismissed Ms. Ignat's claim. Luckily for her, the Court of Appeals agrees that an invasion of privacy doesn't require a written agreement, calling such a requirement "outmoded".

I wish Ms. Ignat good luck back in the trial court. Yum! Brands (which, by the way, owns the likes of Kentucky Fried Chicken and Taco Bell) should apologize to Ms. Ignat rather than fighting her claim on technical grounds.


Jody I. LeWitter

December 31, 2013

Retaliation Claim Survives Even When Underlying Sexual Harassment Claim Fails

Sometimes courts raise the bar on sexual harassment claims too high. Whether the sexual harasser's conduct is "severe" or "pervasive" enough to go to trial often seems to be determined by the subjective lenses of the judges. The judges' lenses are often colored by their own life experience. Certainly whether a judge is a "he" or "she" may impact the analysis. Although here in Westendorf v. West Coast Contractors of Nevada, Inc. 712 F.3d 417 (9th Cir 2013), the three judge panel, including a female judge, all found against Ms. Westendorf's sexual harassment claim. Judges ought to walk a mile in the shoes of the victims of this offensive conduct, and they might not be so quick to declare that the conduct isn't severe or pervasive enough. I guess the judges weren't as offended as I was by all the talk about breasts and orgasms.

However, the same panel of judges did understand that Ms. Westendorf's claim for retaliatory termination should go forward, holding that there was a material fact as to whether she was fired because she complained of the crude and offensive remarks.

So, for Ms. Westendorf, the glass is half empty or half full, depending on the perspective!!

Jody I. LeWitter

December 23, 2013

Be Careful What You Say In Your Disability Application: It May Not Bar Your Case, But You'll Have Some Explaining to Do

The best that can be said about Smith v. Clark County School District (9th Cir 2013) 727 F.3d 950, as well as all the case law examining whether what an employee said on his or her disability application bars a claim for disability discrimination/failure to accommodate, is: BE CAREFUL! Anything you say can and will be used against you. However, as explained by the Ninth Circuit in Smith , if what you say can be interpreted in more than one way, this is a question for the jury.

Ms. Smith worked as a literacy specialist at a school district. She had a back injury that limited her mobility. When her principal informed her that she was being assigned to teach kindergarten for the next academic year, she told the principal that her back injury prevented her from doing so. Thereinafter, Ms. Smith aggravated her back injury, and was off work totally until the end of the academic year. She applied for disability benefits and family leave.

Ms. Smith filed a claim for disability discrimination and failure to accommodate under the Americans With Disabilities Act (ADA). The employer-school district filed for summary judgment.

Ms. Smith explained that by filing for disability benefits and family leave, she meant she was temporarily disabled, not that she could never perform her literacy specialist job. The lower court granted summary judgment, holding that Ms. Smith could not both claim disability and claim she could do the job.

The Ninth Circuit reversed, noting that employees should receive a "wide latitude to overcome apparent conflicts between their disability applications and their ADA claim."

So, BE CAUTIOUS! If you have or may have a disability or reasonable accommodation claim, and you need to fill out any paperwork (such as a disability application, workers compensation claim, personal injury case insurance forms, or family leave form) be careful what you say! They are watching you! If possible, consult with a lawyer beforehand!

Jody I. LeWitter
December 23, 2013

December 17, 2013

Labor Arbitration May Preclude Common Law Claims Such as Wrongful Termination in Violation of Public Policy

The law is pretty well settled that a labor arbitration does not generally bar a unionized employee from bringing a claim under the Fair Employment and Housing Act, such as a discrimination, sexual harassment or retaliation claim. See Alexander v. Gardner-Denver (1974) 415 U.S. 36; Camargo v. California Portland Cement Co. (2001) 86 Cal.App.4th 995. However, Wade v. Ports America Management Corporation (2013) 218 Cal.App.4th 648 declined to extend this good fortune to non-statutory claims such as wrongful termination in violation of public policy.

Mr. Wade brought a claim for wrongful termination in violation of public policy. His public policy claim was for race discrimination. Wade justified this outcome by noting the uniqueness of the Fair Employment and Housing Act's statutory scheme. That part, I generally understand, even if I don't agree with it However, the Court didn't stop there. It came up with a hard-to-follow and not so well- reasoned argument that Mr. Wade's public policy against race discrimination was violated was encompassed in his union arbitrations and therefore precluded by it. The fact that his union arbitration didn't in any way address race discrimination, didn't stop the Court from its labored and illogical analysis that it did. So, be very careful of your labor arbitration's impact on any civil case you might bring!

Jody I. LeWitter
December 17, 2013

November 20, 2013

Enforceability of Wage Claim Arbitrations Hangs in the Lurch Pending Remand in California Supreme Court's Sonic II

The tension between an employee's simple right to receive his wages for work he performed and the U.S. Supreme Court's favoritism towards employers, is almost palpable in the tortured history of Sonic-Calabasas A, Inc. v. Moreno (Sonic II) ___ Ca.4th ___ (Oct. 17, 2013).

Here the employer imposed an arbitration agreement upon Mr. Moreno. When Mr. Moreno filed a simple Labor Commission claim to collect his vacation pay, the employer refused to attend the Labor Commission (Berman) hearing, and instead moved to arbitrate the claim. I suspect the move was a ploy to make it so expensive and time consuming for poor Mr. Moreno to collect what wasn't a large amount of money to begin with, that he'd just give up. Lucky for Mr. Moreno, the Labor Commissioner realized the negative implications for all employees just trying to get paid for the work they do, if they can't go to the Labor Commission.

In 2011 the California Supreme Court held that Mr. Moreno was entitled to his Labor Commission hearing, and that if the employer was dissatisfied with the results of the Berman hearing, it could then move to arbitrate. This was a fairly benign and logical holding.

But I guess this wasn't enough for the anti-employee U.S. Supreme Court. It vacated the California Supreme Court opinion, and sent the case back to the California courts for reconsideration. Sonic-Calabasas A, Inc. v. Moreno 132 S.Ct 496 (2011). (I blogged about this previously, see entry of November 20, 2011.)

So, now we are back in the California Supreme Court's "court." Given that the U.S. Supreme Court held that arbitrations are practically invincible, the California Supreme Court felt forced to recant its prior opinion. Thus, it held that a Labor Commission hearing on the way to an arbitration imposed significant delays and could not be tolerated under the U.S. Supreme Court's holding on AT&T Mobility LLC v. Concepcion 131 S.Ct. 1740 (2011).

However, the California Supremes held out some hope. They held that the State of California still has the right to evaluate whether the arbitration agreement is unconscionable because it is, for example, unreasonably one-sided in favor the employer. Because the evidence related to that question had not been developed, the California Supremes sent the case back to the trial court to consider.

We can expect a hearing below looking at a variety of factors, including how unfair this is to Mr. Moreno. If Mr. Moreno has to go to arbitration, he'll need to hire a lawyer to obtain his vacation pay. This is absurd. He'll be paying more in attorney's fees than he will receive in his vacation pay! Likewise, if he has to pay the arbitrator to obtain what would have otherwise been a free hearing before the Labor Commission, this will wipe out his vacation pay, and is unconscionable and unreasonable.

And speaking of speed and efficiency - the ostensible values of the U.S. Supreme Court in basically making arbitration practically invincible - how many court hearings and years must pass before Mr. Moreno simply gets a determination of whether he is owed his vacation pay?

Jody LeWitter
11/20/13

November 13, 2013

Enforceability of Arbitration Agreements Continues to Flutter in the Wind: Arbitration Agreement Upheld in Peng v. First Republic, but Depending on Circumstances, Might Not be Upheld in Other Cases

Reading arbitration cases is like walking through a muddy field on a dark and rainy night. What is okay in the context of one case, is not in the context of another case. It just depends on how much you slip and slide through the mud and where exactly you fall.

Take the recent case of Peng v. First Republic (2013) 219 Ca.4th 1462. The Court held that failure to attach the arbitration rules didn't make the arbitration agreement procedurally unconscionable. On the other hand, if the arbitration rules had changed any important substantive rights, the agreement might have been procedurally unconscionable. So, we are left guessing whether in any other situation, an employer has to provide the arbitration rules to an employee or not.

Second, Peng held that the right of the employer to change the employment contract terms at any time, whereas the employee cannot, did not make this agreement substantively unconscionable. Why? Because the employer is supposed to act with "good faith . . . and fair dealing." So, if the employer doesn't act in good faith and fair dealing, well, then, is the agreement invalid? Again, slip and slide. We're left guessing.

This case just demonstrates that interpreting whether or not arbitration agreements are valid prove what I've said one hundred times: There is no valid and coherent way to justify involuntary arbitration agreements.

Jody LeWitter
November 13, 2013

November 1, 2013

California Court of Appeals Clarifies That the Standard for Discrimination Claims is Generally Now a Substantial Motivating Factor After Harris v. Santa Monica

Proving discrimination cases by the standard of a "substantial motivating factor" is now clearly the law of the land - at least in the land of California. Let's look at why this is so, and what it means.

First, in May 2013, the California Supreme Court declared that the standard of "substantial motivating factor" would replace the previously accepted "a motivating factor" in mixed motive cases under California law. Harris v. City of Santa Monica, 56 Cal.4th 203 (2013). (Mixed motive cases are cases where the employee proves there was discrimination, but the employer proves it would have made the same decision even without this discriminatory animus).

Although the language in Harris was broadly stated, it wasn't one hundred percent clear whether this standard applied to all discrimination cases under California law, or just mixed motive cases. Along comes Alamo v. Practice Management Information Corporation (2013) 219 Cal.4th 466, holding that the Harris decision applies to almost all employment discrimination cases, thus hammering a nail in the coffin of "a motivating factor" standard under California law. In other words, in an employment discrimination case, although discrimination need not be the sole reason for the wrongful act - it must be a "substantial motivating factor".

We who represent employees never like it when a court gratuitously makes the standards that govern employment discrimination cases more difficult to meet. Hence, it is important to analyze what this standard will mean as a practical matter. First, there is prior case law that defines "substantial motivating factor" in a way that clarifies that this standard really shouldn't be more onerous. See for example, Rutherford v. Owens-Illinois, Inc., (1997) 16 Cal.4th 953, 969 (substantial motivating factor is more than an infinitesimal or theoretical reason). Second, for purposes of summary judgment (i.e. a judge deciding whether a case should go forward to a jury) hopefully judges will have the general intelligence to see that - since the question of discrimination is really for the jury - this slight change in standard should not impact the judge's decision. Third, in terms of a jury's decision, it is a bit difficult to think that jurors will find for an employee if they don't think the discrimination was substantial.

Now, however, whenever you file a discrimination claim in California, it is worth considering whether you should also pursue a federal claim, in addition to the state claims. This is because federal claims for race, religion, sex or national origin discrimination will be governed by "a motivating factor" standard, because that standard is written right into the statute. USC §2000e-2. Of course, in doing so, you may find yourself removed to federal court . Thus, the pros and cons of federal versus state court have to be carefully balanced against the more liberal causation standard.

I'm not happy that the California courts did this. It seems absurd to judicially make the standard more strict than the federal statutory standard, but let's keep our fingers crossed on the day-to-day impact of this.

Jody LeWitter

November 1, 2013

July 26, 2013

California Employees Can Avoid the Supreme Court's New Heightened Burden in Retaliation Cases

Dr. Naiel Nassar was employed by the University of Texas Southwestern Medical Center as a faculty member and staff physician. Dr. Nassar, who is of Middle Eastern descent and practices Islam, claimed that one of his supervisors was biased against him on account of his ethnic heritage and religion. As a result, he resigned his faculty position, but continued working as a staff physician.

After resigning, he sent a letter complaining that the reason he resigned was due to his supervisor's "religious, racial and cultural bias against Arabs and Muslims." Based on this complaint, the Hospital withdrew his job offer. Dr. Nassar filed a Title VII lawsuit claiming, among other things, retaliation. The jury found for Dr. Nassar and the Court of Appeals for the Fifth Circuit affirmed the retaliation verdict. (The jury also found for Dr. Nassar on his discrimination/constructive termination claim. The Court of Appeals reversed on that issue. That claim was not before the Supreme Court). However, the University appealed to the Supreme Court to decide what type of causation a plaintiff must prove in a retaliation case.

In Title VII discrimination cases, a plaintiff only needs to show that his discrimination was a "motivating factor" in the decision to terminate him. The "motivating factor" standard acknowledges that even though there may be legitimate factors in deciding to take an adverse employment action against an employee, if the employee shows that discriminatory animus was one of the motivating factors, he has met his burden.

In its June 24, 2013 University of Texas Southwestern Medical Center v. Nassar decision, the Supreme Court held that in proving a retaliation claim under Title VII, a plaintiff must prove "but for" causation. "But for" causation requires the employee to show that retaliatory animus actually motivated the employer's decision to take the adverse action against the employee rather than the lower burden of showing that retaliatory animus was a motivating factor in the decision.

The Court's justification was politically motivated. After explaining that the number of retaliation claims has increased substantially, the Court simply decided to limit these claims by arbitrarily making them more difficult to prove.

It is not 100% clear what the standard is for a retaliation claim under state law (the Fair Employment and Housing Act), but whatever the standard is, it is a better standard than under federal law. For years, California employees only had to prove that discrimination was a motivating factor in the employment decision to prove discrimination under FEHA. Recently, the California Supreme Court issued Harris v. City of Santa Monica, 56 Cal.4th 203 (2013), setting a brand new standard of "substantial motivating factor" - a standard lesser than "but for" but greater than "a motivating factor." Harris v. City of Santa Monica specifically dealt with a mixed motive case.

We believe that "motivating factor" is still the standard in retaliation cases because retaliation cases were not discussed in the Harris v. City of Santa Monica decision, but what the courts do remains to be seen. Regardless, the State causation standard is better than the federal standard in a retaliation case. This isn't true for the causation standard in a discrimination case, where "a motivating factor" is written right into the statute. See 42 US 2000e-2(m). While the Nassar decision was a striking blow against employees who are victims of retaliation, fortunately, California employees can avoid the heightened "but for" cause standard by bringing their case under FEHA. Still, all these mixed up standards make employment cases a little more complicated that necessary.

July 26, 2013
Jody LeWitter

July 19, 2013

New U.S. Supreme Court Cases on Same-Sex Marriage Expand Leave Rights for Same-Sex Spouses

On June 24, 2013, the United States Supreme Court issued two rulings that were met with a roar of approval from equal rights advocates from coast to coast. Just days before the annual LGBT pride celebrations got underway nationwide, the Supreme Court struck down the Defense of Marriage Act ("DOMA"), and issued another decision which resulted in same-sex marriages resuming in the state of California.

Although the most obvious effect of Hollingsworth v. Perry is that same-sex couples once again have the right to get married in California, many same-sex couples are now wondering how their rights, if they choose to get married, will be impacted with respect to their employment. One of the many benefits same-sex spouses are now entitled to is family leave under the federal Family Medical Leave Act ("FMLA").

In U.S. v. Windsor, the Supreme Court struck down a provision of DOMA that defined the term "spouse" as only a person of the opposite sex who is a husband or wife, and defined "marriage" as a legal union between a man and a woman. There are over 1,000 federal statutes that use the term "spouse," and among them is the FMLA which provides up to twelve weeks per year of job-protected unpaid leave for covered employees. Prior to the U.S. v. Windsor decision, same-sex spouses could not take FMLA leave to care for each other because they were excluded from coverage by the opposite-sex definition of spouse in DOMA. Now, however, same-sex spouses are entitled to coverage under the FMLA and may take leave to care for their spouse with a serious health condition. Unfortunately, however, this decision does not have an impact on couples in recognized domestic partnerships or civil unions which means, same-sex couples who are not married are still without FMLA rights.

In California, even before the Supreme Court's recent decisions, the California Family Rights Act (a state law substantially similar to the FMLA) gave covered employees the right to take leave to care for a registered domestic partner or same-sex spouse. While same-sex spouses in California have rights under CFRA, the problem for many same-sex couples in recent years has been the moratorium on same-sex marriages. Although some 18,000 same-sex couples got married in 2008 during the brief period when California was conducting same-sex marriages, for the past four and a half years, no same-sex couples have been legally married in California. This means that same-sex couples who were not legally married or were not registered domestic partners were not covered by the CFRA leave protections. The good news under the CFRA then, is not that the definition of "spouse" has changed but that fact that same-sex couples can now become spouses if they so choose. Once married, a same-sex couple is entitled to the same protections as an opposite-sex couple under CFRA.

In addition to providing leave to covered employees, both the FMLA and CFRA have anti-retaliation provisions which prohibit an employer from punishing employees for exercising their rights under either of these two laws. Same-sex spouses who are denied or discouraged from taking leave under the FMLA or CFRA will now have recourse against their employers and have stronger protections in the workplace. This makes the laws against sexual orientation discrimination stronger than they were before.


July 19, 2013
Siegel, LeWitter & Malkani

July 9, 2013

Lucky to be a California Employee: If you are Harassed by a Supervisor You Can Avoid the US Supreme Court's Ruling in Vance v. Ball State University

Under both California law and Title VII of the Civil Rights Act of 1964, your employer may be liable if you are harassed by either a co-worker or a supervisor. However, it is more difficult to hold an employer liable for harassment if the harasser is a co-worker, and easier if the harasser is a "supervisor." Enter the United States Supreme Court in Vance v. Ball State University, unnecessarily tightening up who is a supervisor to allow employers to escape responsibility for harassment.

Title VII does not specifically define who is a "supervisor," which has created some disagreement among the lower courts. Some courts determined that an employee is not a supervisor unless he or she has the power to "hire, fire, demote, promote, transfer, or discipline the victim," while other courts follow the broader interpretation of supervisor which includes individuals who have "the ability to exercise significant discretion over [another employee's] daily work." While the difference may seem subtle, it is common in many workplaces for an employee to have a supervisor who tells them what to do on a daily basis but that person does not have the authority to hire, fire, or promote them.

This difference is particularly important for workers like Ms. Maetta Vance. Ms. Vance, an African American woman, worked as a catering assistant at Ball State University. She complained on several occasions that catering specialist, Saundra Davis, racially harassed her over a period of time. She also alleged that Ms. Davis was her supervisor, and therefore, the University was liable for the harassment.

Last week, in Vance v. Ball State University, the Supreme Court rejected Ms. Vance's argument and held that an employer is only vicariously or strictly liable for supervisor harassment when "the employer has empowered that employee to take tangible employment actions against the victim, i.e. to effect a 'significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits.'"

This is a significant blow to employee rights under Title VII as it restricts employer liability in harassment cases. Based on this decision, under Title VII, if the person harassing you does not have the power to take a tangible employment action against you, such as hiring, firing, demoting, transferring or disciplining, the employer is not strictly liable.

Fortunately for California employees, not only do employers have a harder time escaping liability for supervisor harassment, but California law also has a more expansive definition of "supervisor" written into the law. Under the California Fair Employment and Housing Act, Govt. Code § 12926(s), supervisor is defined as:

"any individual having the authority, in the interest of the employer, to hire, transfer, suspend, layoff, recall, promote, discharge, assign, reward, or discipline other employees, or the responsibility to direct them, or to adjust their grievances, or effectively recommend that action..."

This more inclusive definition would have served Ms. Vance well had she been employed in California. In the coming months and years we will likely see whether employers seize on this opportunity to limit their liability in harassment cases. However, in California the protections under the Fair Employment and Housing Act are unchanged and will continue to protect workers from harassment by their supervisors, whether or not they have the power to take "tangible employment actions." You can read the full opinion here.

July 9, 2013
Siegel, LeWitter & Malkani