California Public Agency Labor and Employment Blog - Useful Information for Navigating Legal Challenges

This guest post was authored by Judith S. Islas

The Court of Appeal’s decision in Sanchez v. Swissport, Inc., is a case of widespread importance, impacting the rights of employees disabled by pregnancy and pregnancy related-conditions.  In this case, the Court considered the plight of Anna Sanchez.  After becoming pregnant, she was diagnosed with a high risk pregnancy and placed on bed rest for the remaining eight months of her pregnancy.  Her employer, Swissport, provided Sanchez the required four months pregnancy disability leave.   After the four month leave ended, Sanchez was unable to return to work and requested an extended leave of absence throughout the remainder of her pregnancy.  Swissport did not agree to additional leave and terminated Sanchez’s employment because she could not return to work.

Sanchez sued for pregnancy and pregnancy related  disability discrimination, failure to engage in the interactive process, and a variety of related claims.   Sanchez claimed that after she exhausted the four months of pregnancy disability leave, Swissport had an obligation to provide her additional leave as a form of reasonable accommodation under the Fair Employment and Housing Act (“FEHA”). Swissport disagreed.  It argued that because the pregnancy disability laws expressly provide for four months leave, the leave caps at four months, and once the four months leave expired, Sanchez had no other protection under FEHA.  Therefore Swissport, argued,  it had the right to terminate Sanchez when her four months of pregnancy disability leave expired and she could not return to work.

The appellate court decisively rejected Swissport’s argument.   The Justices pointed to the language of the pregnancy disability laws, which expressly state that its remedies augment, rather than supplant, the other remedies in FEHA. Pregnancy disability leave is contained within the broader provisions of the FEHA and is only one of the protections provided to pregnant employees.  Pregnancy disability leave entitles an employee disabled by pregnancy up to four months of leave regardless of any hardship to  the employer.  The obligation to reasonably accommodate a disabled employee due to pregnancy or some other condition is a separate obligation under the FEHA. The obligation to reasonably accommodate may include a leave of absence of no fixed duration, provided that leave does not impose an undue hardship on the employer.   The Court pointed to multiple cases holding that unpaid leave for extended periods well beyond four months can be a required form of reasonable accommodation.   In this case, Swissport had an obligation to engage in the interactive process with Sanchez to determine whether additional unpaid leave was a reasonable accommodation or whether it imposed an undue hardship on Swissport.

What This Means to Employers

Employers cannot terminate employees who are disabled by pregnancy or pregnancy related conditions after the four months of pregnancy disability leave expires without extending additional rights under the Fair Employment and Housing Act.  If the employee continues to be disabled, and cannot return to work, the employer must engage in the interactive process to determine whether additional leave is a form of reasonable accommodation, and/or other possible types of reasonable accommodations.  Employers may also have a separate obligation under their own personnel rules or memoranda of understanding to provide additional leave beyond four months.  Employers should promptly consult with their legal counsel where an employee exhausts the four months pregnancy disability leave and is still unable to return to work. 

Harris v. City of Santa Monica has been pending before the California Supreme Court since 2011.  Melanie Poturica and I submitted an amicus brief in the matter, supporting the City’s arguments.  On December 4, 2012, the Supreme Court held oral arguments and will issue its opinion within 90 days, in 2013.

In Harris, plaintiff disclosed to her supervisor that she was pregnant before she was terminated but while she was still on probation as a new hire.  After the City terminated her employment, she sued it alleging that she was fired for discriminatory reasons; i.e., because she was pregnant.  The City’s position was that she was terminated for poor performance.  

In October 2004, the City hired Wynona Harris as a bus driver trainee.  Harris was promoted to probationary part-time driver after having an accident.  After her promotion, she had yet a second bus accident.  Harris also failed to give management sufficient notice that she would be missing a shift. In March 2005, Harris’s supervisor gave her a three-month written performance evaluation with a “further development needed” rating.  Then Harris, again, failed to give adequate notice that she would miss a shift.  The City then decided to release Harris from her probationary position.  About one week later, Harris told her immediate supervisor that she was pregnant.  Her supervisor’s response was: “Wow.  Well, what are you going to do?  How far along are you?” Two days later, the City notified Harris of her termination. Harris subsequently sued the City for pregnancy discrimination, based in part on her supervisor’s alleged discriminatory remarks, and the case went to trial.

The issue before the Supreme Court is the application of the mixed-motive jury instruction in employment litigation brought under California’s Fair Employment and Housing Act.  In a mixed-motive case, to establish “because of” causation, the plaintiff’s initial burden is to prove that discrimination was “a” motivating factor in the adverse employment action (i.e., termination in this case) even though other factors may also have been involved.  The employer then has an opportunity to demonstrate that legitimate reasons came into play so as to defeat liability.  The trial court refused to instruct the jury on a mixed-motive defense.  The City challenges the trial court’s decision because it deprived it of its right to have the jury determine, or even consider, whether the City proved legitimate, non-discriminatory reasons for terminating Harris.  In other words, the jury was not instructed to determine whether the City would have terminated Harris for legitimate nondiscriminatory business reasons despite its knowledge that she was pregnant before it gave her notice of her termination.

We will continue to monitor this case and update you when the Court issues its opinion.

Determining what constitutes an “adverse employment action” is critical when an employee sues for retaliation and/or discrimination.  In order to be able to sustain a claim for either retaliation or discrimination, an employee must sufficiently prove that he/she suffered an adverse employment action.  This issue was recently addressed by the U.S. Ninth Circuit Court of Appeals in an unpublished decision that reiterates the legal standard for assessing whether an employment action is “adverse.” 

In this new case, Carl Woods had sued his employer, the University of Washington, and his supervisor and settled with an agreement that dismissed the case and completely released the University from all liability.  However, Woods later filed a second lawsuit against the University, making allegations of discrimination and retaliation in violation of Title VII of the Civil Rights Act of 1964, and a similar Washington state civil rights law. 

In this second lawsuit, Woods alleged that his supervisor retaliated against him for previously suing him in the first lawsuit.  Woods also made an allegation of sexual harassment against his supervisor for refusing to remedy acts of insubordination by one of Woods’ subordinates.  Finally, Woods alleged that the University discriminated against him when it gave him first a “formal counseling” and later a “final counseling.” 

The University and supervisor moved for partial summary judgment on the ground that Woods had failed to demonstrate sufficiently that the formal counseling and final counseling constituted “adverse employment” actions as defined by law.  In order for claims of retaliation or discrimination to survive, an employee must demonstrate that one or more adverse employment actions were taken for discriminatory or retaliatory reasons.  In other words, the plaintiff must prove that the actions taken were not for legitimate, non-discriminatory or non-retaliatory purposes. 

The University and supervisor prevailed on summary judgment and the Court of Appeals affirmed.  For an employee to support a claim of discrimination or retaliation, s/he must show that the employer took adverse action as a result of the protected activity.  The Ninth Circuit reiterated the legal standard for establishing an adverse employment action: the action to be “adverse” must negatively affect the employee’s compensation, workplace conditions, responsibilities, or status. 

Applying this standard, the Ninth Circuit held that the formal counseling and final counseling Woods received were not adverse employment actions because they did not affect Woods’ compensation, workplace conditions, responsibilities or status, even though the final counseling caused Woods to forfeit seniority for a period of time.  Also, the Ninth Circuit noted, even if the final counseling did amount to an adverse action, Woods failed to show discriminatory intent or that he was treated differently than similarly situated employees outside his protected class. 

We regularly advise public agencies on how to deal with employees with serious performance or behavior issues in the workplace.  We also defend agencies in state and federal court against lawsuits alleging discrimination or retaliation which were filed after the employer has taken employment actions to address legitimate performance or behavior issues.  In doing this work, we have watched agencies grapple with the issue of what steps to take where there is a concern that an employee may sue.  It is important that your agency document all supervisory decisions made to counsel or discipline employees having performance or behavior issues.  Taking action to try and correct performance or behavior is not unlawful so long as the action is not done for retaliatory or discriminatory purposes.  Proper documentation of all discussions related to an employee’s issues, and of all actions taken against the employee to try and correct or discipline performance or behavior, will help your agency defend itself in the event that the employee alleged that the actions were taken for discriminatory or retaliatory reasons.

The “blue wall” is a phrase sometimes used to refer to an unofficial practice of police officers protecting or shielding the wrongdoing of a fellow officer.  In an interesting twist, one police officer claimed that when his department placed him on paid administrative leave and then failed to afford him the “professional courtesy” of intervening in a criminal investigation by another agency, it thereby discriminated against him and failed to afford him equal protection under the law.  Not buying it? Fortunately, neither did  the Second Circuit of the U.S. Court of Appeals. (Brown v. City of Syracuse.)

Curtis Brown was a police officer for the Syracuse, New York Police Department (“SPD”).  In 1999, based upon an allegation that Brown was involved in an inappropriate relationship with a 15-year-old girl, a Captain investigated and determined the complaint was unfounded. The Captain, however, ordered Brown to have no further contact with the girl.

Several months later, the girl contacted Brown, claiming she was distraught over a fight with her mother and had left home. The girl asked Brown to pick her up because she did not feel safe alone. Brown picked up the girl and rented a hotel room for her to stay.  The girl’s mother discovered the girl’s location and that the room had been rented in Brown’s name.  State police were called who then contacted SPD.  When asked about the girl’s whereabouts by an SPD officer, Brown stated he did not know where the girl was and denied renting her the room.   The next day, Brown similarly denied knowing of the girl’s whereabouts when asked by a SPD Captain, even though Brown had just given the girl a ride to school.  The Chief ordered Brown suspended with pay pending an investigation.

The State Police began an investigation and asked SPD if they wanted to assist. SPD declined because the girl lived outside city limits.  The State Police charged Brown with endangering the welfare of a child. Brown pled guilty to one misdemeanor count.  This resulted in automatic loss of his status as a peace officer under New York law and thus, his employment with SPD.

Brown filed suit against SPD on several grounds including race discrimination in violation of Title VII of the Civil Rights Act and a claim under 42 U.S.C. §1983 alleging a violation of his Constitutional right to Equal Protection under the Fourteenth Amendment.  After a series of orders and appeals, the district court ultimately granted summary judgment in favor of SPD and other defendants.  Brown appealed and the Court of Appeals affirmed. 

Brown claimed that the SPD had discriminated against him based on his race (African-American) by suspending him with pay pending an investigation when SPD did not take the same action against Caucasian officers who had engaged in similar misconduct.  In relying on earlier precedent the Court noted that “administrative leave with pay during the pendency of an investigation does not, without more, constitute an adverse employment action.”  The question was whether the employer simply applied reasonable disciplinary procedures or if it exceeded those procedures and thereby changed the terms and conditions of employment.

“Paid suspension during an investigation could thus potentially be adverse if the employer takes actions beyond an employee’s normal exposure to disciplinary policies.”

Brown argued that the loss of overtime pay was “more” than a mere paid administrative leave that exceeded the City’s policies.  The Court disagreed, holding that such a finding would be “absurd.”  Brown further argued that white officers accused of worse conduct were allowed to stay on the job.  However, Brown offered no evidence of a similarly-situated white officer who was not suspended pending an investigation.

Brown next argued that his right to Equal Protection under the law was violated when the SPD refused to extend him the same “benefits and privileges” extended to white officers.  Brown alleged he should not have been investigated in the first place and, in any event, the SPD should have become involved in his investigation and worked with the State Police and District Attorney to achieve a more favorable outcome for him.

The Court distinguished a prior published decision in which a department that investigated its own officer for criminal misconduct was found to have violated the officer’s Constitutional rights.  There, a deputy sheriff had voiced unpopular opinions about the sheriff’s office after which, three officers lay-in-wait surveilling the deputy while he had dinner with his wife.  After observing the deputy having a couple glasses of wine, the officers pulled the deputy over on his way home and charged him with DUI.  There, the court held that an Equal Protection claim was cognizable because the defendants sought out, surveilled, and investigated the deputy in a calculated attempt to punish him for his protected activity.

The distinction here, the Court held, was that Brown was not sought out and caught by discriminatory means.  Rather, Brown was merely denied the “blue wall of silence” or “professional courtesy” behind which he expected his fellow officers to mitigate or hide his misconduct.

 “…to recognize a constitutional violation here based on a failure to extend a ‘professional courtesy’ would create bizarre incentives encouraging officers to meddle in criminal investigations of a fellow officer’s misconduct in order to avoid being subject to liabilty. This ‘would stand the Equal Protection Clause on its head.’”

While an employer shoud apply all of its policies even-handedly, no employer is required to turn a preferential blind eye to the misconduct of its own employee.

There are numerous signals that the U.S. economy is recovering – unemployment numbers are improving in California and elsewhere, there are mixed indications of a brighter housing market, and the stock market over the last months has improved substantially.  The overall mood may have also turned a corner, with less news of economically motivated protests, or of waves of foreclosures, and more talk of IPO’s and new business ventures.

For some California public sector employers, a brighter outlook is corresponding with more hiring.  Although this is good news, the hiring process does carry legal risks, just as did downsizing and other like matters in bad economic times.

Here are six areas of the hiring process in the public sector that deserve particular attention from a legal perspective.  This is not an exhaustive list of such areas, or a complete list of considerations, but it provides a general framework for what to trouble-shoot before hiring begins in earnest.  

1.         Utilize Accurate Job Descriptions:  At the very outset of the hiring process, it is critical to develop accurate and sufficiently detailed job descriptions.  These will prove important not only for hiring, but also for legal issues that may arise later during the course of the employment relationship.  An accurate job description will help the agency demonstrate that questions on job applications and during interviews are legitimate and non-discriminatory, and help those in the hiring process focus on eliciting those facts that are job-related.  Also, in the context of disability discrimination laws, in both the hiring process and during employment, an agency’s identification of the “essential functions of the job” will be critical.  Under both federal and state law, a Court will treat the job description prepared by the employer prior to advertising or interviewing for the job as evidence of what are essential functions. 

Detail in the job description can be very important also, because vague or overly general job descriptions can fail to give proper guidance either to applicants deciding whether to seek the job, or to agency personnel making the hiring decisions.  Misunderstanding about the nature of the job can produce charges of discrimination or of failure to accommodate.  At a minimum, a job description should contain: (a) job-related educational requirements, (b) necessary vocational skills, (c) required work experience, (d) examples of duties, (e) unusual physical requirements, (f) work hours, and (g) compensation.  Where possible, job requirements should be validated by experts using professionally accepted validation methods.  

2.         Establish a Uniform Screening Process for Applications:  The next phase to consider is the initial “screen” of applications for those who are not qualified or not competitive in light of the quality and experience of other applicants.  As a general matter, an employer’s initial “screen” must be conducted in a neutral manner that does not result in an unjustifiable, disproportionate impact with regard to a protected characteristic, e.g. race, gender, religion, age over 40, etc.  Accordingly, the agency should establish a set of job-related screening criteria which do not result in exclusion of individuals who are qualified and competitive for the job.  The agency should also have a process in place to make a separate review of the fairness and appropriateness of screening criteria, to make sure the screening guidelines are followed, and to confirm that decisions were not influenced by improper considerations. 

3.         Focus Interviews on Job-Related Questions, and Avoid Improper Questions:  Like other aspects of the hiring process, interviews must be non-discriminatory.  Questions should focus on qualifications for the job in question, and not pertain to protected characteristics.  The California Department of Fair Employment and Housing has promulgated a list of questions that cannot be asked in an interview.  Some unlawful questions are straightforward, such as asking about an applicant’s race, age, religion, or other protected characteristics.  But the list also encompasses some questions that bear indirectly on these matters, such as questions about the date of completion of school, religious days the applicant observes, or the applicant’s birthplace.  (The list of questions is available at: http://www.dfeh.ca.gov/res/docs/publications/dfeh-161.pdf.)  The FEHA publication lists how questions can be phrased in a way that requests information the employer legitimately needs without creating an impression of bias.  (For example, it would be appropriate to ask which languages an applicant speaks, if relevant to the job at issue.) 

It is vital that agencies ensure that those employees conducting interviews have received training in what are protected classifications, and what questions are prohibited – and of course those conducting interviews should have become thoroughly familiar with the job description and nature of the job in question.  

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The California Court of Appeal recently highlighted a fundamental flaw in the California Civil Jury Instructions (“CACI”) on a cause of action for retaliation in violation of the Fair Employment and Housing Act (“FEHA”).  The instruction is missing the element of retaliatory intent or animus.  This flaw has not been brought to the forefront previously because it would only be found in unusual circumstances such as those that were presented to the Court in Joaquin v. City of Los Angeles.  However, this also highlights the same fundamental flaw in another CACI instruction, particularly, disability discrimination. 

In Joaquin, a police officer was terminated following an evidentiary hearing by an independent review board which found that the officer made a knowing false accusation against his sergeant of sexual harassment. A superior court later ordered the officer reinstated finding that the review board’s decision was not supported by substantial evidence. 

The officer then filed a lawsuit alleging that the City terminated him in retaliation for making the complaint of sexual harassment, a violation of FEHA.  The jury was given the standard CACI No. 2505 instruction on retaliation which requires a verdict in favor of the plaintiff if: (1) the plaintiff made a complaint of harassment; (2) the plaintiff was subjected to an adverse employment action; (3) the complaint of harassment was a motivating reason for the adverse employment action; (4) plaintiff was harmed; and (5) the adverse employment action was a substantial factor in causing plaintiff’s harm.  

Because of this jury instruction, the City all but admitted the essential elements of the cause of action. As a result, the jury had no choice but to return a verdict in favor of the officer.  The City appealed and the Court of Appeal reversed, finding that the jury’s verdict was not supported by substantial evidence because there was no evidence that the City’s decision to terminate the  officer was intended to retaliate against him for making a complaint of harassment.  Rather, the independent board of review, after conducting an evidentiary hearing, had an honest, good faith belief that the officer lied about the allegations against his sergeant. This qualified as a legitimate, nonretaliatory reason for the officer’s termination, defeating the plaintiff’s cause of action. 

It was here the appellate court astutely noted that “retaliatory intent is an essential element of a cause of action for unlawful retaliation under FEHA.  However, the element is not identified in the CACI retaliation instruction.”    Thus, had the jury been asked whether the independent review board’s decision was motivated by the intent to retaliate against the officer for making a complaint of harassment, it most likely would have reached a contrary conclusion. 

While intent is an essential element of a cause of action for unlawful retaliation, it undoubtedly is also an essential element of a cause of action for discrimination.  In a thorough discussion of the relevance of discriminatory intent, one court stated, “[t]he defendant’s discriminatory mental state is crucial.”  For that reason, the CACI instruction on discrimination, particularly disability discrimination, is similarly flawed.  

Consider the following hypothetical:  Your employee is giving you reason to doubt her fitness for duty.  You send the employee for a fitness for duty exam. Your agency’s doctor finds the employee unable to perform the essential functions of the job because of a physical condition. After you exhaust the interactive process, you separate the employee because she is unable to perform the essential functions of the job with or without a reasonable accommodation and no other accommodation is feasible. Generally, under FEHA, if an employee has a physical or mental condition that limits a major life activity, including the ability to work in a single job for a single employer, the employee is considered to have a protected disability.  Thus, an employer in this hypothetical has seemingly terminated the employee because of the employee’s disability or because the employer perceived the employee as having a disability. 

The employee sues your agency for disability discrimination.  At trial, the employee pays for a doctor to opine that she is fit and can perform the essential functions of the job.  The jury is given the standard CACI instruction on disability discrimination: to establish a cause of action, plaintiff must prove: (1)  that the agency was an employer under FEHA; (2) that plaintiff was an employee of the agency; (3) that the employer knew or perceived  that the plaintiff had a “disability”; (4) that the plaintiff was able to perform the essential job duties with or without reasonable accommodation; (5) the employer discharged plaintiff; (6) that the plaintiff’s real or perceived “disability” was a motivating reason for the discharge; (7) that plaintiff was harmed; and (8) that the employer’s discharge was a substantial factor in causing plaintiff’s harm. 

Assuming the jury were to be more persuaded by the employee’s doctor-for-hire than your agency’s doctor, the jury will return a verdict against the agency regardless of the fact that your agency had an honest, good faith belief that the employee was unable to perform the essential functions of the job, an otherwise legitimate, nondiscriminatory reason for the discharge. 

However, as the court in Joaquin and numerous other courts in this state have noted, intent is an essential element of a cause of action for discrimination.  Moreover, if an employer’s adverse employment decision is based on reasons which, if true, preclude a finding of discrimination, the employer cannot be liable for discrimination, even if the employer’s honestly held belief is later shown to be wrong or unwise. While the objective soundness of an employer’s proffered reason supports their credibility, the ultimate issue is simply whether the employer acted with a motive to discriminate illegally.  That is why the CACI instruction on disability discrimination also presents a flaw in failing to include discriminatory intent as an element to the cause of action. 

The Joaquin decision came at no better time. The California Judicial Council recently issued an “Invitation to Comment” on new and revised CACI, including instructions on retaliation and disability discrimination.  Those wanting to comment on the new and revised jury instructions should submit their comments by March 2, 2012. 

California’s Military and Veterans Code contains protections against discrimination for members of the armed forces.  Recently, the issue of whether an individual can be held personally liable for discrimination was addressed. 

In Haligowski v. Superior Court of Los Angeles County, the Court of Appeal held that employees who are members of the armed forces may only hold employers, but not individual supervisors or other employees, personally liable for employment discrimination against armed forces members in violation of California Military and Veterans Code section 394, even though the statute expressly states that “no person” can discriminate against a member of the armed forces. 

In Haligowski, Lieutenant Mario Pantuso was called to active duty with the Navy while working at Safway Services.  He served a six month deployment in Iraq, and sought to return to work to his prior position upon his return.  Instead of being returned to work, his supervisor and the regional manager told Lt. Pantuso that he was terminated.  Pantuso sued Safway, his supervisor and the regional manager for discrimination and retaliation under the California Military and Veterans Code. 

Section 394 prohibits any “person any “person, employer, or officer or agent of any company” from discriminating against military members because of that membership. The Court reviewed the body of case law holding that individuals cannot be liable for discrimination or retaliation under the California Fair Employment and Housing Act (FEHA). Following that reasoning, the Court found that discrimination claims against individuals that arise out of necessary personnel management duties, and decisions that are an inherent and an unavoidable part of the supervisory function, cannot be the basis of a discrimination claim against an individual.  The Court found that a supervisory employee cannot refrain from the type of conduct which could later give rise to a discrimination claim.  In contrast, however, harassment is conduct that is not necessary for the performance of a supervisory job.  Thus, individual employees can be held liable for harassment on the basis of membership in the armed forces.

It is noteworthy that this case does not change the ability of an employee to sue an individual for employment discrimination under federal law.  Under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA), an employee can sue an individual employee for employment discrimination based on their membership in the military.

This decision does not change the ability of an employee to sue an individual for employment discrimination under federal law.  Under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA), an employee can sue an individual employee for employment discrimination based on their membership in the military. 

The Haligowski decision establishes new precedent under Section 394 in that it prohibits individual supervisor liability for employment discrimination against members of the military.  Regardless, public employers should train its supervisors and employees that it is unlawful to discriminate on the basis of an employee's military service or membership.  This is especially important since, under federal law, plaintiffs can seek to hold individual employees liable for employment discrimination based on their military membership.  Plus, employees can be held liable for harassment on the basis of military membership under state law.  Finally, in this context, the public agency itself can be held liable for discrimination, retaliation, and harassment under state and federal law, thereby making it important to train all employees on how to prevent liability for such claims.   

The holidays are a festive time to be shared with family, friends and even coworkers.  Many employers also join in the celebrations by allowing employees to put up decorations and exchange gifts.  Employers also like to host holiday parties filled with food, music and alcohol.  However, these types of activities may create legal liability for employers.  The following few tips can help employers avoid liability without spoiling their employees’ holiday fun. 

Religious Holiday Accommodations

For many, the holidays are a time for religious observance.  For example, a Christian employee working the night shift may ask for the evening off to attend Christmas Eve mass or a Jewish employee may request time off to observe Hanukkah.  Both federal and state discrimination laws require employers to accommodate their employees’ sincerely held religious beliefs, practices and observances.  Thus, employers who are confronted with requests for time off should try to accommodate them unless it would impose an undue hardship.  Accommodating an employee may mean changing the employee’s schedule or allowing the employee to switch shifts with a coworker.    

Workplace and Workspace Decorations

Before decking the halls, employers should consider the location of holiday decorations.  Employers who plan to decorate common work areas should strive to avoid the appearance of endorsing one religion over another.  For example, if a nativity scene is displayed in the reception area or lunchroom, the employer may be perceived as favoring the Christian religion which some employees may find offensive.  Employers who wish to decorate the workplace should use non-religious, winter themed decorations such as snowflakes, candy canes, holly and gingerbread houses.

However, employees who wish to decorate their own personal workspaces with Christmas, Kwanzaa or Hanukkah themed decorations present a more difficult question.  For example, prohibiting employees from displaying religious holiday themed decorations in their own workspaces may give rise to violations of free speech and freedom of religion claims.  Because the law requires employers to accommodate religious beliefs, employers should not try to suppress religious expression in the workplace unless it creates an undue hardship on business operations.           

Finally, mistletoe should never be allowed in any area of the workplace including individual workspaces because it could lead to sexual harassment or hostile work environment claims.

Holiday Gift Exchanges

The traditional holiday gift exchange where one employee gives a gift to a randomly assigned employee has largely been replaced by the “white elephant” gift exchange.  Employees favor this type of gift exchange because it is fun and the gifts up for grabs are often humorous.  However, this game can easily turn into blood sport as employees become competitive and even downright vicious towards each other in their quest for the best gift. 

In order to ensure fun for all employees, the announcement of a gift exchange should include language reminding employees to select gifts appropriate for the workplace.  For example, employees should be discouraged from buying items that contain profane, graphic or sexual content.  In addition, employees should be reminded that the gift exchange is a festive occasion where everyone should be treated respectfully. 

Holiday Parties

The two biggest concerns for employers about holiday parties is potential legal liability from sexual harassment and drinking and driving.  Because employees typically “let their hair down” during these events, they may not conduct themselves the same way as they do at work.  Also, alcohol clouds judgment.  Employers may want to consider taking the following preventative steps to reduce liability. 

Employees should be reminded of the employer’s discrimination, harassment and alcohol and drug policies.  In addition, employers should designate a supervisor or manager to provide discrete oversight over employees during the party.  For example, if an employee appears to have had too much to drink, the supervisor or manager should intervene and arrange for the employee to get home safely.  If alcohol is served, employers should limit the amount consumed either by issuing drink tickets to employees or stopping the service of alcohol well before guests start leaving the party.  Finally, if a harassment complaint is made after the party, employers should make sure they investigate it promptly.  

This post was co-authored by Michael Blacher

God said “Be fruitful and multiply.”  But does that make a math teacher at a religious school a “minister?”  The United States Supreme Court will soon decide.

On October 5, 2011, the U.S. Supreme Court heard oral argument in Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC, a case which involves the application of the “ministerial exception.”  That exception allows religious organizations, including religious schools, to make employment decisions affecting “ministers” without being subject to anti-discrimination laws.  The ministerial exception is a judicial creation rooted in the First Amendment’s Free Exercise and Establishment clauses.  The Hosanna-Tabor case requires the Supreme Court to define the meaning of a “minister” and, in particular, to determine whether it can extend to a teacher at a religious school who instructed primarily on secular topics. 

The facts of Hosanna-Tabor are as follows.  Hosanna-Tabor Evangelical Lutheran Church and School operates a church and an elementary school.  It has two types of faculty: (1) limited-term “lay” or “contract” teachers and (2) for-cause “called” teachers.  Called teachers must complete a course of religious study and receive a certificate of admission into the teaching ministry.  They receive the title of “commissioned minister.” 

In 2000, Cheryl Perich began work as a contract teacher but shortly thereafter changed her status to a “called” teacher.  Her employment duties remained essentially the same.  She taught math, language arts, social studies, science, gym, art, and music.  However, Perich also taught a religion class four days per week, attended a chapel with her class once a week, and led her classes in prayer. 

In 2004, Perich went out on disability leave.  The School Board ultimately offered Perich a “peaceful release” agreement wherein she would release claims against the School in return for a monetary payment.  When Perich refused and threatened legal action, however, the Board fired her.

Perich filed a charge with the Equal Employment Opportunity Commission (“EEOC”) for disability discrimination and retaliation under the Americans with Disabilities Act (“ADA”), and the EEOC decided to litigate the charge of retaliation on her behalf.  The district court determined that Perich was covered by the ministerial exception and granted summary judgment to the School. 

The U.S. Court of Appeals for the Sixth Circuit reversed.  It found that because most of Perich’s job duties did not have a religious character, and that her “primary” functions were secular, the ministerial exception did not apply.  The School appealed to the United States Supreme Court which granted certiorari.

On October 5, 2011 the Court heard oral arguments.  The Justices did not appear to reach any kind of consensus.  Justices Sotomayor and Kagan appeared focused on the rights of all employees to bring retaliation claims.  Justice Roberts asked whether the Court could involve itself in this issue at all when some religions considered all members to be witnesses to the faith and “ministers” of sorts.  Justice Breyer’s questioning stood apart by appearing to suggest the exception should apply only if the employment action at issue rested on church doctrine and called upon courts to decide religious questions.    

The attorneys’ positions were equally diverse.  Counsel for the EEOC contended that the ministerial exception should not apply to retaliation claims.  The Assistant to the Solicitor General suggested that the ministerial exception should not apply at all since schools were regulated by the State.  The attorney for the School avoided articulating a precise definition of a “minister,” but during his rebuttal he proposed “[a] minister is a person who holds ecclesiastical office in the church or who exercises important religious functions . . . including teaching of the faith.”  Oral arguments ended without a clear sense as to how the Justices might rule.

The Supreme Court’s holding in this case will prove very significant for religious schools and organizations, and our firm will provide a supplemental report when it issues.

Since the beginning of month, the U.S. Equal Employment Opportunity Commission (“EEOC”) has filed a dozen lawsuits against employers for disability discrimination.  Four lawsuits, which were filed in the Northern and Eastern Districts of the U.S. District Court, address various facets of disability discrimination.

One of the cases was filed against Walgreens drug store for failing to accommodate and for firing a diabetic employee who was cashier in the company’s South San Francisco store.  The employee, who worked for Walgreens for nearly 18 years without a blemish in her work history, opened a bag of chips while on duty because she was suffering from an attack of low blood sugar.  The chips cost less than two dollars and the employee paid for it.  The EEOC alleges that the company fired her after it learned of the incident although it knew the employee was diabetic. 

The EEOC also filed a lawsuit against Merritt Restaurant and Bakery, an Oakland eatery, for firing an employee who suffered from seizures.  The employee, a cook and kitchen manager, had a seizure during the night shift.  Although the employee’s physician cleared him to return to work, the employer delayed his reinstatement and transferred him to the day shift which resulted in fewer work hours and less pay.  According to the EEOC, the employee complained about the change in his work conditions and was fired.

Modesto retailer Buy-Rite Thrift Store fired an epileptic employee after he had small seizures at work.  The EEOC alleges that the company improperly “relied on its own judgment – which is not consistent with the law – to determine that [the employee] was a danger to himself and others” instead of asking the employee to “take a fitness exam or provide medical documentation of his ability to perform the job duties required of his position.”

Finally, the owner of a McDonald’s in Oakhurst was sued by the EEOC for demoting and causing the constructive discharge of an employee with cerebral palsy.  The employee had worked for a prior owner since 2006 without incident.  In fact, the employee had been promoted to a supervisory position.  Within two months of new ownership taking over the McDonald’s operations in 2009, the employee was demoted to a janitorial position.  They also cut his hours and reduced his pay.  The EEOC alleges that the employee was forced to quit his job as a result of the company’s treatment of him.  

While it is too early to know whether these employers will vigorously defend their actions, these lawsuits demonstrate that disability discrimination can come in many forms.  Important lessons can also be learned from these cases.  First, employers should refrain from forming their own opinions on whether an employee is medically or physically able to perform the essential functions of the job.  If there is a valid question as to the employee’s abilities, the employer should ask the employee to take a fitness for duty exam or provide medical documentation certifying fitness.  Second, employers must be flexible in accommodating disabled employees.  This may mean providing accommodations if the employee experiences symptoms related to his or her disability in the workplace.  For example, Walgreens could have accommodated the diabetic employee immediately by simply allowing her to eat the chips and take a break long enough to allow her to raise her blood sugar.  Finally, if an employer wants to change the working conditions of a disabled employee, the employer should evaluate the reasons for the change to make sure it is for legitimate non-discriminatory business reasons.

On June 20, 2011, the United States Supreme Court issued its opinion in the Wal-Mart Stores, Inc. v. Dukes.  The decision makes it much more difficult for very large groups of employees to join to sue an employer for alleged discrimination -- at least in federal court.  

Betty Dukes, a greeter at a Wal-Mart in Pittsburg, California alleged that Wal-Mart violated Title VII of the Civil Rights Act of 1964 by engaging in gender discrimination in both pay and promotions on a national basis.  In the lawsuit, Dukes sought to certify a class action consisting of approximately 1.5 million female employees who worked for Wal-Mart after December 26, 1998.  The issue before the Supreme Court was whether the plaintiffs satisfied the requirements for certifying a class action under Federal Rule of Civil Procedure 23 so as to proceed with one national gender discrimination case against Wal-Mart.  The Court did not address the merits of the case, i.e., whether Wal-Mart engaged in gender discrimination.

Despite the fact that Wal-Mart’s official written policy prohibited discrimination of any kind, Dukes alleged that Wal-Mart’s (1) corporate culture of stereotyping women, and (2) its policy allowing mid-level managers to make pay and promotion decisions (rather than having them made at a higher level) resulted in discrimination against women for many years.  Dukes alleged that these policies constituted discrimination under both disparate impact and disparate treatment theories. 

The district court made several findings justifying its decision to certify the employees as a class.  It found significant evidence of company-wide practices and policies that resulted in gender discrimination, including gender stereotyping, excessive subjectivity in personnel decisions and the maintenance of a strong corporate culture. The court also found statistical evidence that discrimination caused gender disparities and anecdotal evidence of bias.  The Ninth Circuit Court of Appeals upheld the district court’s decision to certify the employees as a class.

In its appeal to the United States Supreme Court, Wal-Mart challenged the certification of the case as a class action on the grounds that the claims of the putative class members were not common (i.e., a requirement to certify a group of individuals as a class).  To support its argument, Wal-Mart argued that its official policy strictly prohibited discrimination and that the plaintiffs’ evidence of an alleged pattern of disparate pay and promotions was too insignificant to establish a company-wide practice of gender discrimination.  Instead, Wal-Mart argued that since thousands of different supervisors and managers were delegated with authority to make decisions about pay and promotion, and since the plaintiffs’ own expert witnesses could not say what percentage of those decisions were “infected” by the alleged corporate culture of stereotyping women, plaintiffs’ evidence was insufficient to support class certification under Federal Rule of Civil Procedure 23. 

Justice Scalia, writing for the majority, agreed with Wal-Mart and ruled that the plaintiffs failed to satisfy Rule 23(a)’s commonality requirement.  Both the majority and the minority decisions also held that the district court and the Ninth Circuit improperly certified the class under Rule 23(b)(2) because the plaintiffs’ claim for back pay was not “incidental” to their request for injunctive and declaratory relief.

With respect to the commonality requirement, the majority held that there must be a common answer to a common question of law or fact -- not simply a common question of law or fact in the first instance.  In the employment law context, this means that a class action plaintiff must show that there is a common reason for the employment decisions at issue.  For example, if one person were responsible for making the thousands of pay or promotion decisions that the Dukes plaintiffs sought to certify, then there would be a common link to the adverse employment decisions – an alleged discriminatory decision maker.  But, where those decisions are made by thousands of different supervisors or managers considering a host of different variables, the majority held that the plaintiffs’ statistical evidence of disparate impact was too insignificant to create an inference of discrimination on a national, company-wide basis. 

Another significant aspect of the majority’s opinion is that class actions seeking monetary relief (as opposed to injunctive or declaratory relief) in all likelihood must proceed under Rule 23(b)(3), which has more procedural safeguards (e.g., a court must find that common questions of law or fact predominate, that a class action is superior to individual actions, mandatory notice and the right of a plaintiff to opt-out, etc.) than class actions certified under Rule 23(b)(2).  Justice Scalia, writing for the majority, also believed it was unacceptable to allow discrimination lawsuits to proceed as large class actions when monetary awards to plaintiffs would be based on a broad formula using something akin to representative sampling.  The majority held that an employer is entitled to individualized determinations of each employee’s eligibility for back pay, and Wal-Mart would be deprived of that right if the Ninth Circuit’s “Trial by Formula” plan were to be sanctioned. 

The bottom line is that this decision will be helpful to employers who are sued in federal court class action lawsuits for alleged discriminatory employment practices so long as the employer’s personnel decision makers are de-centralized.  Whether this decision will impact class actions brought in state court, however, remains an open question. 

This guest post was authored by Oliver Yee

Employee substance abuse poses significant challenges for employers.  At what point in time is a drug user no longer a user?  Certainly, given the complexities surrounding drug use, addiction and recovery, this is a difficult question for an employer to answer.  The 10^th Circuit U.S. Court of Appeals in Mauerhan v. Wagner Corp., was recently posed with this difficult question and its answer should come of little surprise – it’s complicated.

Plaintiff Mauerhan was terminated by his employer, Wagner Corp., for violating its drug policy, but was told by his supervisor that he could return if he got “clean.”  Soon after his termination, Mr. Mauerhan entered into a drug rehabilitation program and tested positive for cocaine and marijuana upon entering the program.  He completed the program in one month and his prognosis at discharge was described by a rehabilitation counselor as “guarded.”  The day after completing the program, Mauerhan contacted Wagner and asked to return to work.  Wagner refused to re-employ Mauerhan in the same position and Mauerhan subsequently filed an action against Wagner alleging discrimination under the Americans with Disabilities Act (ADA) on the basis of his status as a drug addict.

Under the ADA, an employee is not a qualified individual with a disability if he or she is “currently engaging” in the illegal use of drugs when the employer acts on the basis of such use.  42 U.S.C. § 12114(a).  Indeed, section 12114(a) provides a “safe harbor” for employees who are not “currently engaging” in the illegal use of drugs and specifically exempts an employee who “has successfully completed a supervised drug rehabilitation program and is no longer engaging in the illegal use of drugs, or has otherwise been rehabilitated successfully and is no longer engaging in such use….”  Id. at Section 12114(a)(1).

In Mauerhan, the 10^th Circuit interpreted the “currently engaging” exception to the ADA.  Mauerhan argued that he was no longer “currently engaging” in the illegal use of drugs because he had completed the one-month addiction treatment program and was no longer engaging in drug use when he sought re-employment.  The 10^th Circuit followed several other circuits and refused to adopt a bright-line rule for determining when an individual is no longer “currently engaging” in drug use.  Rather, the Court held that an individual’s eligibility for the safe harbor must be determined on a case-by-case basis.  Specifically, the circumstances of the individual’s drug use and recovery must justify a reasonable belief that drug use is no longer a problem.  With respect to Mr. Mauerhan, the 10^th Circuit found that he was “currently engaging” in the use of drugs when he sought re-employment.  The Court relied on the uncontroverted expert testimony of an addiction specialist who declared that approximately three months of treatment would be necessary for an addict like Mauerhan to reach a “threshold of significant improvement.” 

The Mauerhan decision reveals the complexities surrounding drug use, addiction and the recovery process.  By refusing to adopt a bright-line rule for determining when an individual is no longer “currently engaging” in drug use, the 10^th Circuit acknowledged that the timeframe for drug addiction recovery is not absolute and that a balancing analysis must be applied on a case-by-case basis.  The Mauerhan decision provides valuable insight to employers.  Employers should strongly consider utilizing a more flexible approach when addressing employees who suffer from substance addiction.

LCW provides a workshop and workbook on Issues and Challenges Regarding Drugs and Alcohol in the Workplace to assist public agencies with these matters.

Hospitals and other medical-related employers are at the forefront of a growing trend of employers who have adopted policies prohibiting the hiring of smokers.  This practice goes far beyond merely banning employees from smoking in the workplace.  Rather, these employers are actually telling smokers that they need not apply for employment at all, or that they will be fired if they are caught smoking, even if away from the workplace. 

The New York Times recently reported that employers who have implemented smoker-free workplace policies now have applications that “explicitly warn of ‘tobacco-free hiring,’ job seeker must submit to urine tests for nicotine and new employees caught smoking face termination.”  Employers who have adopted policies banning smokers from employment justify this hiring practice as advancing their mission to promote personal well-being and healthier living.  These employers also cite efforts to reduce high health care costs and increase employee productivity.  Opponents of smoker-free policies argue that they invade personal privacy and could pave the way for employers to regulate other lifestyle choices such as consuming alcohol or even fast food.

This growing trend begs the question of whether California employers may legally adopt similar policies that smokers will not be hired.  After all, California was a leader in passing anti-smoking laws that banned smoking in public places such as restaurants, bars and casinos.  Currently, California is considering legislation that if passed would ban smoking at all state parks and beaches.  Even the stereotype of a Californian is that of a health-conscious, physically fit individual. 

However, Californians are also known to be champions of civil liberties.  Thus, California employers will likely face numerous efforts seeking to obstruct implementation of smoker-free policies.  For example, Labor Code sections 96(k) and 98.6 prohibit employers from discharging an employee or discriminating against any employee or applicant for employment because the employee or applicant engaged in lawful conduct occurring during nonworking hours away from the employer’s premises.  Since the act of smoking itself remains legal in California, employers who refuse to hire smokers may be subject to liability under these provisions. 

In addition, smoker-free policies may be challenged on privacy grounds as an improper attempt to monitor and regulate personal conduct.  Finally, an aggrieved smoker may be able to assert a claim for disability discrimination if he or she is able to show that the employer believed that the smoker would be more likely to miss work due to smoking-related illnesses.  Both the Americans with Disabilities Act and the Fair Employment and Housing Act prohibit discrimination based on a perceived disability. 

This guest post was authored by Judith Islas

Does an employee who retired because of disability, but is now medically cleared to return to work, have the right to get his old job back?  And, does the employer have an obligation to engage in the interactive process and agree to reasonable accommodations whenever a former employee wants to return to work and even though the employer does not intend to rehire him?  Thankfully, the California Court of Appeal answered no to both questions when deciding a case where Peter Brown and I defended a local fire district in a disability discrimination lawsuit brought by a former fire captain who retired due to a disability in 2002 and demanded to be rehired in 2006.

The Court’s decision is significant because it rejects the former employee’s attempt to  misuse the disability discrimination laws to demand preferential treatment, instead of equal treatment.  The former employee argued that, because he is disability retired, the disability discrimination laws required the district to rehire him, once he was medically cleared to work.  He argued that although retired and no longer a district employee he should nevertheless be treated the same as a disabled employee on medical leave, who has the right to return to work once medically cleared.  The former employee also argued that, once he demanded to return to work, the district was required to immediately engage in the interactive process and agree to specific reasonable accommodations.

The Court of Appeal firmly rejected both arguments.  The Court’s reasoning is captured in these few sentences:

In our view-based, we think, on common sense and common understanding –‘retirement’ is a generally permanent life choice and reflects the understanding of both parties that the employer/employee relationship has terminated.  ‘Retirement’ is not the same thing as ‘leave of absence,’ and no amount of saying it will make it so.

Also, the Court explained, the district did not have an obligation to engage in an interactive process or agree to reasonable accommodation for a former employee it did not intend to rehire.

The decision in this case avoids what would have created an impossible task for employers, to guarantee that a disability retiree could have his old job back if he was later medically cleared and wanted to return to work.  That would give employers the options of indefinitely holding a job open or filling the job, but creating another one if the former employee ever asks to return to work.  This would provide disability retirees even more protection than current employees on leave as the cases do not require that their position be kept open for an indefinite time period.

Although, this victory was decisive, a word of caution is in order.  Although, there is no right to be rehired, a disability retiree has the right to apply for positions open to external candidates.  And, of course, the application must be processed and considered using the same non-discriminatory standards as any other applicant.

The Supreme Court’s recent ruling in Thompson v. North American Stainless has caused some commentators to sound the alarm warning employers of employee friendly courts and impending lawsuits as a result of the decision.  Hans Bader of the Washington Examiner wrote that the Thompson decision shows the Supreme Court is not pro-business.  Tim Gould of the website HRMorning.com warns that the decision will result in increased employer exposure to retaliation lawsuits.  However, for California employers, the ruling represents just another pro-employee decision which is part of doing business in California’s pro-employee environment.

In Thompson, Miriam Regalado and her fiancé Eric Thompson were employees of North American Stainless (NAS).  Regalado filed a charge alleging sex discrimination against NAS with the Equal Opportunity Commission (EEOC) which, in turn, notified NAS of the complaint in February 2003.  Within weeks of learning of the charge, NAS fired Thompson.  Following his termination, Thompson filed his own EEOC charge and sued NAS under Title VII of the Civil Rights Act of 1964 claiming the company fired him to retaliate against Regalado for filing her EEOC charge.  Both the District Court and the U.S. Court of Appeals affirmed the dismissal of Thompson’s Title VII claim on the ground that the law does not permit third party retaliation claims.  The Supreme Court reversed the Court of Appeals’ decision on the ground that NAS’s firing of Thompson was retaliatory and that he could sue NAS for violation of Title VII. 

The Court reasoned that the purpose of Title VII’s anti-retaliation provision is to prohibit any employer action that might dissuade a reasonable worker from making or supporting a discrimination charge.  Thus, the Court thought “it obvious” that a reasonable worker might be dissuaded from filing a complaint against her employer if she knew her fiancé would be fired.  Although the Court declined to identify “a fixed class of relationships” for which third party reprisals are unlawful, it indicated that a close family member who is fired will “almost always” be able to assert a claim under Title VII while a “mere acquaintance” will “almost never” be able to do so.  The Court also reasoned that Thompson was a “person aggrieved” for standing purposes because he fell within the “zone of interests” protected by Title VII.  Thompson was an employee of NAS, and the purpose of Title VII is to protect employees from their employers’ unlawful actions.  Finally, the Court found Thompson was not an accidental victim of retaliation.  Rather, NAS intentionally fired him in order to punish Regalado for filing her EEOC charge. 

While the Thompson decision is significant and will undoubtedly spawn more lawsuits nationwide, employment claims by third parties are not an entirely new concept in California.  Government Code section 12926(m), part of California’s Fair Labor and Employment Act (FEHA), already gives employees the ability to sue their employers over adverse actions taken against them because of their association with “another person” in a protected class (e.g. race, marital status, sex).  However, it remains to be seen whether this FEHA provision would provide a basis for a claim such as the one asserted by Thompson.  Thus, employers should make sure that the harassment training provided to employees, supervisors and managers includes a discussion which educates them on the possibility of third party employment claims.  Employers should also consider revising existing anti-harassment policies to explicitly prohibit discrimination, harassment and retaliation against an employee who associates with a person, including another co-worker, in a protected class.  

Recently, the EEOC lost a lawsuit against an employer, Con-Way Freight, under allegations that the company did not hire an applicant because of her race. In support of these allegations, the EEOC offered evidence that one manager, upon learning of the applicant’s race, made a statement that hiring the woman would “open a can of worms” and the other manager told the applicant that his manager did not want him to hire her because if he did he was just “begging for the NAACP.”

Were these statements inflammatory? Absolutely. Was it stupid for these managers to make these statements? Definitely. Does it make the employer liable for discrimination? Not so much.

See, Con-Way freight had an unwritten, but well established policy of not hiring any person with theft-related criminal convictions. The complaining applicant in this case had two. So, regardless of the moronic statements made by these two managers, she would not have been hired by the employer, anyways.   While not discussed in this case, Con-Way’s policy would appear to be reasonable as well. As a company devoted to shipping and carrying products across the country for its clients, theft is probably a top priority.

In addition, neither of these managers actually played a role in deciding not to hire the complaining applicant. Con-Way had a central human resources department.  Applicants had to be put forward by a manager to the HR department which would run a background check and then notify the manager whether the applicant was approved.  Since Con-Way fired the hiring manager before he put any name forward to the HR department, the complaining applicant never had the opportunity to be approved or disapproved by the company, let alone by any manager with a discriminatory intent.

The EEOC jumped too quickly on this one simply because a couple managers made some incendiary statements. But what the EEOC was missing was a nexus. There was a lack of evidence linking the statements to any decision not to hire the applicant. In addition, the EEOC missed the fact that this applicant would have never been hired, anyways, because of her criminal record.  As an agency with a noble cause on a taxpayer-budget, the EEOC would do well to better pick the cases it takes to litigation.

Equal Employment Opportunity Commission v. Con-Way Freight, Inc. (8th Cir. 2010) -- F.3d --; 2010 WL 3655999.