Under updated guidance issued by the California Department of Public Health (“CDPH”),[1] certain asymptomatic unvaccinated employees who have had a close contact exposure[2] to someone with COVID-19 may end their quarantine and return to work seven (7) days after the exposure as opposed to ten (10) days.

The CDPH guidance provides that unvaccinated individuals who have a close contact exposure may discontinue the required quarantine after seven (7) days, so long as the individual is asymptomatic, is tested for COVID-19 at least five (5) days after the exposure, and the test produces a negative result. This quarantine period is shorter than the ten (10) day exclusion period required for such individuals under the Cal/OSHA COVID-19 Regulations.[3]

Employers may rely on the updated CDPH guidance to allow unvaccinated employees who satisfy the return-to-work criteria to return sooner than previously permitted. Employers do not need to adhere to the lengthier exclusion period under the Cal/OSHA COVID-19 Regulations because Executive Order N-84-20[4] provides that CDPH may establish a shorter exclusion requirement.

Duration of Quarantine for Unvaccinated Individuals

Given the updated guidance, asymptomatic unvaccinated employees who have a close contact exposure may discontinue their quarantine and return to work under either of the following circumstances:

  1. Ten (10) days after the date of the last known close contact exposure without being tested for COVID-19; or
  2. Seven (7) days after the last known close contact exposure if the employee is tested for COVID-19 no earlier than the fifth (5th) day following the last exposure and the employee tests negative.

In addition to the rules regarding the discontinuation of the quarantine, asymptomatic unvaccinated employees should continue daily self-monitoring for symptoms and follow all recommended safety precautions (wearing a mask when around others, hand washing, avoiding crowds, and staying at least six feet from others) for fourteen (14) days following the last known exposure. If an employer prevents one of their employees from complying with these conditions, the employee will need to observe the longer exclusion period specified in the Cal/OSHA COVID-19 Regulations.


As a result of the updated guidance, employers may direct unvaccinated employees who are excluded from work as a result of a close contact exposure to be tested for COVID-19 on the fifth (5th) day following the exposure in order to return to work in a shorter period of time. Employers should note that if they direct employees to be tested, the employer will be responsible for any costs incurred by the employee[5] as a result and compensation for the time waiting to be tested and being tested.[6]

Employers should also note that they have an obligation to adhere to the most restrictive or prescriptive applicable guidance on this subject and certain local health departments may still require a full ten (10) day quarantine regardless of testing.

LCW attorneys are familiar with the operation and interaction of the laws and public health orders implicated here and are ready to assist employers revise their policies and practice to account for the updated guidance.

[1] CDPH, Guidance on Isolation and Quarantine for COVID-19 Contact Tracing (last updated on September 9, 2021) <https://www.cdph.ca.gov/Programs/CID/DCDC/Pages/COVID-19/Guidance-on-Isolation-and-Quarantine-for-COVID-19-Contact-Tracing.aspx>.

[2] The CDPH defines “close contact” as an individual who comes within 6 feet for a cumulative total of 15 minutes or more over a 24-hour period with someone with suspected or confirmed COVID-19.

[3] Cal/OSHA COVID-19 Regulations (last updated on June 17, 2021) <https://www.dir.ca.gov/dosh/coronavirus>.

[4] Executive Order N-84-20 (December 14, 2020) <https://www.gov.ca.gov/wp-content/uploads/2020/12/12.14.20-EO-N-84-20-COVID-19.pdf>.

[5] Labor Code, § 2802 subd. (a).

[6] 29 C.F.R. § 785.43.

This article was originally published in October 2019.  The information has been reviewed and is up-to-date as of October 2021.


Many workplaces and schools engage in Halloween celebrations, and with good reason.  LCW is no exception:

However, Halloween parties can be scary for risk managers, as they carry the potential to put a few skeletons in an employer’s closet.  Here are some tricks to keep your Halloween party from raising the specter of liability:

  • Employees Should Know They are Free to “Ghost”.  Participation in any Halloween festivities should be entirely optional.  Employees may not feel comfortable celebrating Halloween; for some employees, it may be prohibited by their religious beliefs.  Nobody should be required to take part, and an employer should not tolerate teasing or ostracism of an employee who opts out.  It’s only fun if everyone’s having fun.
  • When Choosing Costumes, Don’t Let the Zombies Eat Your Brain.  Dracula, Frankenstein, Mickey Mouse, Elsa and/or Anna, a cowboy, an M & M, a puppy, any of the three PJ Masks. . . there are nearly unlimited options for inoffensive Halloween costumes.  And yet, every year, some ghouls make the news by wearing costumes that would give any employer nightmares.  Human Resources professionals can reduce this risk by providing common-sense guidance as to what is an appropriate costume for a Halloween celebration at the office:
    • An attempt to “wear” or parody another culture, religion, race, or identity is not a costume; it’s an exhibit in someone else’s lawsuit for harassment or discrimination.  It should go without saying that blackface or brownface is unacceptable.  The same is true of traditional cultural dress.  A good costume does not make one’s colleagues feel caricatured, mocked, or belittled for their protected characteristics.  On the other hand, an employee should not be prohibited from wearing expressions of his or her own identity.  Context matters.
    • At some point, Halloween shifted from being an opportunity for kids to get free candy to an opportunity for adults to free themselves of their inhibitions.  Inhibitions can be a good thing at work.  A Halloween costume should not expose any part of an employee’s body that ordinary work clothes would not.  If a costume is described by the seller as “sexy” or some euphemism therefor, it is probably better saved for a non-work outing.  Bottom line: the provisions of the employer’s dress code related to appropriate attire still apply.
  • No Creepy Behavior.   Despite HR’s best efforts, some employees may wear provocative costumes to the office.  This does not give other employees license to make comments or engage in conduct that would otherwise violate the employer’s harassment or other conduct policies.  If the behavior is beyond the pale, Halloween does not provide a get-out-of-Hades-free card.
  • Stay Safe Out There. If your employees work with equipment that may impact their health or safety, extra care should be taken to ensure that costumes do not imperil employees.  Some Halloween revelers like to accessorize costumes with fake weapons; realistic-looking toys could cause legitimate fear; these should not be allowed.

If an employer utilizes these few simple tricks, the office Halloween party should be a treat, and the only stomachache a risk manager should suffer is from raiding the candy bowl.


On September 27, 2021, Governor Newsom signed Senate Bill (SB) 278, which adds Government Code section 20164.5 and will go into effect on January 1, 2022. SB 278 greatly increases the potential costs to CalPERS agencies for reporting errors, by creating new and in some cases retroactive financial exposure for CalPERS agencies already struggling to fund their pension obligations. Specifically, SB 278 would shift almost all of the consequences for reporting later disallowed compensation to the employer.

For context, the Public Employees’ Retirement Law (PERL) provides a defined benefit retirement plan for public agency employees administered by CalPERS.  The Public Employees’ Pension Reform Act of 2013 (PEPRA) made changes to the categories of compensation that can be included in some employees’ retirement benefit calculation.  The statutes, regulations, and administrative guidance concerning which items are reportable are complex and can be confusing, which sometimes leads to unintended reporting errors.  In addition to the complicated regulatory scheme, the items of compensation are often the product of negotiations, which sometimes causes the parties to inadvertently negotiate criteria that makes the item non-reportable on technical grounds (e.g., adding additional criteria to qualify for the benefit that are not expressly contained in the regulations).  It is not uncommon for these issues to go back years or even decades because the language is rolled over into successor labor agreements.

Under pre-SB 278 law, if CalPERS determined that a disallowed item of compensation was included when calculating a retiree’s retirement benefit allowance, the retiree had to pay CalPERS back the amount of the overpayment, and retirement allowance payments were reduced prospectively based on what the retiree would have received if the improper item of compensation had not been included.  CalPERS generally may collect amounts that were overpaid within the last three years.  Essentially, the individual must pay back and stop receiving that which they were never entitled to in the first place.

SB 278 Transfers Almost All of the Risk of Misreported Compensation to the Employer

SB 278 requires local agencies to pay CalPERS the full cost of any overpayments made to the retiree based on the disallowed compensation and pay a 20-percent penalty of the amount calculated as a lump sum of the actuarial equivalent value of the difference between the retiree’s pension calculated with the disallowed compensation and the pension calculated without the disallowed compensation for the projected duration of the benefit.  In other words, in addition to paying CalPERS directly for any overpayments actually received and retained by the retiree, the employer must also pay a 20-percent penalty of the present value of the projected lifetime and survivor benefit.  Ninety percent of the penalty is paid directly to the retiree and 10 percent is paid as a penalty to CalPERS.  While the remedies are harsh, the version of SB 278 that was originally introduced would have required the employer to pay 100 percent of the value of the lost benefits to the retiree as a lump-sum payment or annuity.

With respect to retired members, the penalty is triggered where the following conditions are met:

  1. The compensation was reported to the system and contributions were made on that compensation while the member was actively employed;
  2. The compensation was agreed to in a memorandum of understanding or collective bargaining agreement between the employer and the recognized employee organization as compensation for pension purposes and the employer and the recognized employee organization did not knowingly agree to compensation that was disallowed;
  3. The determination by the system that compensation was disallowed was made after the date of retirement; and
  4. The determination by the system that compensation was disallowed was made after the date of retirement.

The statutory language raises several questions that will require guidance from CalPERS or may need to be litigated. First, the statute does not explain when compensation was agreed to in a collective bargaining agreement “as compensation for pension purposes.”  For example, if an item of compensation is provided in a collective bargaining agreement and reported to CalPERS, but the collective bargaining agreement is silent on whether the item is reportable to CalPERS, do those two facts in combination trigger the statute?  Prospectively, can employers avoid application of the statute by affirmatively stating in the collective bargaining agreement that no representations are made as to whether an item will be included in pension calculations unless CalPERS affirmatively confirms that the item is reportable?

Second, it is not clear how the retroactive component of the statute will be applied. The statute applies to any prospective determinations and also to determinations made on or after January 1, 2017, if the appeal rights of the retiree have not been exhausted.  A CalPERS’ determination made after the enactment of the statute could potentially apply to decades of previously misreported compensation, and in many cases would impact an entire bargaining group covered by a particular labor agreement.  Employers will likely need to argue that the statute operates only prospectively, except for unresolved ongoing appeals of determinations that were made after January 1, 2017.

Third, and similar to the retroactive issues discussed above, it is uncertain how CalPERS and courts will apply the statute to compensation that was incorrectly reported before January 1, 2022, but where CalPERS’ decision to exclude the compensation is not made until after January 1, 2022.  If the statute is interpreted to have broad retroactive effect, it may very well incentivize CalPERS to start aggressively auditing local agencies, because any unfunded liabilities for inadvertently misreported compensation would be shifted directly to the employer and compensation carrying unfunded liabilities can be removed from the books.  CalPERS also receives a portion of the prospective reduction of benefits as a penalty against the agency.  The potential combined retroactive liability and penalties for public employers could be significant – and impossible to predict.  While SB 278 has a provision for CalPERS to review labor agreements prospectively and provide guidance, the statute does not specify that CalPERS’ approval will be binding and prevent a later negative determination.

Fourth, the statute of limitations applicable to repayment is going to need to be resolved, likely through litigation.  CalPERS has taken the position in the past that the three-year statute of limitations that applies to recovery of overpayments from retirees, does not apply to collections of overpayments from employers.  SB 278 is silent on how far back collections can be pursued for overpayments on determinations that come within the statute’s reach.

For current employees, SB 278 does not make significant changes, as it allows improper contributions to act as a credit towards a public agency’s future contributions, and any contributions paid by the employee on the disallowed compensation is returned.  There are no overpayments to address because the employee has not yet retired or started receiving a retirement allowance.

What Can Public Agencies Do Now to Prepare for SB 278

In preparing for SB 278, public agencies should review all their collective bargaining agreements covering CalPERS’ members and scrutinize each item of compensation that is reported to CalPERS to ensure that the item is indeed reportable under applicable statutes, regulations, and administrative guidance.  If not, the agency should take action to correct the language or the practice that makes it non-reportable.  This will not resolve existing liability for overpayments in case of a CalPERS’ audit, but it may reduce the potential liability for future retirees.  These changes would also be subject to meet and confer requirements.  Depending on how aggressively the statutory language is applied, agencies may need to start looking at more drastic measures, such as moving away from special compensation items and to higher base salary, as the majority of these issues involve misreported items of special compensation.


Over the last several months, mandatory vaccination requirements took center stage in the public response to COVID-19, but with the play getting underway and vaccination requirements becoming operative, it is the request for religious accommodation (i.e., exemption from vaccination requirements) that may be stealing the show.

Title VII and FEHA Set the Stage for Religious Exemption Requests 

While equal employment opportunity laws permit vaccination requirements as a condition of employment, Title VII of the Civil Rights Act of 1964 (Title VII) and the Fair Employment and Housing Act (FEHA) prohibit religious discrimination in employment and can protect employees who cannot comply with such requirements because of their sincerely held religious beliefs.

Because “religion” is broadly defined under Title VII and the FEHA, claims that an employee holds a sincere religious belief that precludes compliance with a policy are difficult to question.

“Religion” includes “all aspects of religious observance and practice as well as belief.” It includes beliefs that are commonly associated with the teachings or tenets of the established world religions (i.e., Christianity, Judaism, Islam, Hinduism, and Buddhism) as well as new and uncommon beliefs. These beliefs do not need to be connected with any religious group. Even if an individual is a member of a religious group, their beliefs may differ from the teaching or tenets of a faith to which the individual otherwise subscribes.

The breadth of this definition makes questioning an individual’s religious belief difficult. The Equal Employment Opportunity Commission (EEOC), which enforces Title VII, provides that “the employer should ordinarily assume that an employee’s request for religious accommodation is based on a sincerely held religious belief.” However, the EEOC does acknowledge that “if an employer has an objective basis for questioning either the religious nature or sincerity of a particular belief, observance, or practice, the employer would be justified in seeking additional supporting information.”

Religious Exemption Requests Become the Star of the Show

Historically, employee requests for religious accommodations from workplace policies have been uncommon, the understudy to more common requests for medical accommodation. However, in the context of vaccination requirements, these roles have reversed, and requests for exemption to vaccination requirements based on religion are becoming the star of the show.

Employers are responding to the newfound fame of the religious exemption request in different ways. On one end of the spectrum are employers that are inclined to accept requests for religious exemption from vaccination requirements without much, if any, question. On the other end are employers that may be skeptical of such requests and inclined to scrutinize each request.

Determination of Qualification

 As a preliminary matter, employers must determine that there is a conflict between the employee’s religious beliefs and the employer’s COVID-19 vaccination requirement or the requirement imposed by a superseding authority.

There are two ways that we would suggest that employers approach this initial question, either provide employees a “yes or no” question as to whether they have a sincerely held religious belief that precludes vaccination, or request that they explain in their own words how their sincerely held religious belief precludes vaccination.

Employers who adopt the first approach generally accept responses in which the employee answers “yes” as ending the inquiry as to whether the employee has a sincerely held religious belief. Employers who adopt the second approach are more inclined to probe further, as discussed below.

Nature of a Religious Belief

Courts recognize that, by legal definition, a “religion” addresses fundamental and ultimate questions having to do with deep and imponderable matters, that it is comprehensive in nature and consists of a belief-system as opposed to an isolated teaching, and may be recognized by the presence of certain formal and external signs.

If the employee’s response as to the conflict between their religious belief and the employer’s vaccination requirement does not provide sufficient information to determine whether the belief is religious in nature, the employer may reasonably ask additional questions in order to ascertain that the basis of the employee’s opposition to vaccination is religious.

For example, compare the following responses to the question concerning a conflict between the employee’s religious belief and the vaccination requirement:

  • “The COVID-19 vaccines were developed using or tested on fetal cell lines, and I cannot in accept vaccination with a product that relies on fetal cells.”
  • “I adhere to a religious belief that recognizes that life begins at conception and that every human life is sacred, and because the COVID-19 vaccines were developed using or tested on fetal cell lines, I cannot in good faith accept vaccination with a product that violates this belief.”

The first response states only an opposition to the use of products developed using or tested on fetal cell lines, but does not provide any information that the opposition is religious. Therefore, the employer could reasonably ask certain additional questions in order to ascertain the nature of the employee’s objection, and about the belief system that makes use of products impermissible. On the other hand, the second response demonstrates a belief system that, if not comprehensive, is not merely limited to opposing COVID-19 vaccinations, and includes some consideration of existential issues, such as life and death, that are common to religions.

Any secondary inquiry by an employer should be individualized and should focus on whether the employee’s refusal to be vaccinated is actually part of and pursuant to a system of religious beliefs held by the employee.

Sincerity of a Religious Belief

A second line of questioning concerns the sincerity of employee’s religious beliefs.

While courts recognize that an employee’s sincerity is largely a matter of individual credibility, there is no clear guidance as to what factors may sufficiently undermine an employee’s credibility on this subject. This can understandably make employers reluctant to probe into the sincerity of an employee’s religious beliefs. However, if an employer were to make such an inquiry, the employer should consider limiting its inquiry to the following factors that courts have recognized as potentially undermining an employee’s credibility:

  • Employee behavior that is markedly inconsistent with the professed belief;
  • The timing of the employee’s request renders it suspect; and
  • The employer has other reason to believe that the employee’s request for accommodation is not sought for religious reasons.

In the context of COVID-19 vaccination each of these factors could conceivably be implicated, as provided below:

  • The employee recently received other vaccinations, including potentially a first COVID-19 inoculation;
  • The employee recently expressed personal objections to COVID-19 vaccinations, and did not cite any religious reasons for such opposition ; or
  • The employee purchased a religious exemption form from an online church with which they had no previous relationship.

While an employer’s inquiry into the sincerity of an employee’s sincerely-held religious belief should be narrowly tailored and no more intrusive than necessary, where the employee’s conduct creates an objective basis to question the employee’s credulity, additional probing may be appropriate.

Star Turn for Religious Exemption

Employers that are adopting their own vaccination policies or merely complying with a superseding authority’s directive should consider how they will approach questions of religious exemption, and whether they will adopt a more permissive or assertive approach to such requests.  The requests for exemption will come and it is prudent to consider how to respond before being star struck.

When working with employees with disabilities, employers need to keep track of various laws that govern whether the employee may be entitled to leaves, accommodation, or even a disability retirement.  What makes matters more complicated is that the definition of disability is not the same under each law.  So, while a medical condition may meet the legal definition of a disability under one of the laws, it may not under another.  We will explore the various ways that “disability” has been defined in federal and California law.


Under the federal Family and Medical Leave Act and the California Family Rights Act, an employee may be eligible for leave if the employee has a “serious health condition.”  Under the FMLA, a “serious health condition” is defined as “an illness, injury, impairment or physical or mental condition that involves inpatient care . . . or continuing treatment by a health care provider.”  Similarly, under the CFRA, a “serious health condition” is defined as “an illness, injury (including, but not limited to, on-the-job injuries), impairment, or physical or mental condition of the employee or a family member of the employee that involves either inpatient care or continuing treatment, including, but not limited to, treatment for substance abuse.”

One major difference between the two leave laws is pregnancy-related disabilities.  Under the FMLA, pregnancy-related disabilities do qualify as a “serious health condition.”  However, under the CFRA, pregnancy-related disabilities do not.  Under California law, employees with pregnancy-related disabilities may be entitled to Pregnancy Disability Leave, which is separate from leave under the CFRA.


Under the federal Americans with Disabilities Act and the California Fair Employment and Housing Act, an employee may be eligible for a reasonable accommodation if they have a physical or mental condition that impairs a major life activity.  Please note that under the ADA, the requirement is that the condition must “substantially” impair a major life activity, but that under the FEHA, the impairment need not be “substantial.”  For California employers, we recommend using the FEHA standard.

Unlike the definition of “serious health condition” above, a disability under ADA/FEHA does not need “inpatient care” or “continuing treatment” to be considered a disability.  Rather, ADA/FEHA examines whether a “major life activity” is impaired.  Major life activities include, but are not limited to, caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, sitting, reaching, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, interacting with others, and working.

PERL – Disability Retirement

For those agencies that are subject to the Public Employees’ Retirement Law, there is yet another definition of disability that they must know.  Under PERL, an employee may be eligible for disability retirement if the employee has a “mental or physical incapacity for the performance of the usual duties.”  The “incapacity for performance of duty” means “disability of permanent or extended duration, which is expected to last at least 12 consecutive months or will result in death”

Here, there is a need to look at the duration of the incapacity prospectively.  It must either be permanent (which is not necessarily the same thing as “Maximum Medical Improvement” or “Permanent and Stationary”) or expected to last at least 12 months.  So, while a short-term disability under ADA/FEHA may entitle an employee to an accommodation, it may not entitle the employee to a disability retirement.

Workers’ Compensation

Workers’ compensation defines an industrial injury as any injury or disease arising out of employment, regardless of fault.  This is a broad definition, but the key is that it arises out of employment.  An industrial injury may overlap with any of the definitions of “disability” above, but that is not always necessarily the case.

Paid Sick Leave

California’s Paid Sick Leave Law provides for a minimum amount of sick leave for an employee to use for the “diagnosis, care, or treatment of an existing health condition of, or preventive care for, an employee.”  Employers probably do not consider employees using “sick leave” as having a disability.  For example, a common cold is probably not going to qualify as a disability under the laws above.  However, this does not mean that the laws are mutually exclusive of one another.  If an employee has a condition that qualifies as a “disability,” then the employee could also be eligible to use leave under the Paid Sick Leave Law.

Employer Policies

Finally, your agency may provide its own sick leave benefits to your employees.  Please review your agency’s own policies, rules, and regulations to determine for what purposes sick leave can be used.

* * *

Employers have to navigate the various laws that define “disability.”  Unfortunately, there is not one standard definition that applies to all the various laws.  As a result, it can often be confusing and difficult at times (especially when you may get conflicting opinions from different doctors!).  Please consult with legal counsel if your agency needs assistance in navigating these various laws.

This article was originally published in February 2014.  The information has been reviewed and is up-to-date as of August 2021. 

Under the federal Americans with Disabilities Act (ADA) and California Fair Employment and Housing Act (FEHA), the employer has the duty to identify and implement a reasonable accommodation to allow a disabled employee to perform the essential functions of the job.  Common pitfalls for employers in determining appropriate accommodations are:

  1. Over-reliance on the written job description

    Job descriptions are critical in the disability interactive process for identifying the essential functions of the job.  This is one reason why we repeatedly urge employers to update job descriptions.  However, the employer should refrain from over-relying on the written job description for identifying the essential functions without considering what is actually occurring in the workplace.  For instance, a written job description for a parks maintenance worker may list removal of trees as an essential job function and state that this function requires the worker to use a heavy piece of equipment such as a wood chipper.  However, in practice the maintenance workers may have only removed one tree in the last several years.   So this essential function may not be essential after all.  This is a fact specific determination that should be made on a case-by case basis.  The important thing for the employer to do when determining the essential functions is to make the relevant inquiries of incumbents and supervisors for the job position and consider how the job is currently being performed.
  2. Failure to consider leave of absence or telework as an accommodation

A leave of absence may constitute a reasonable accommodation especially where it could rehabilitate a disabled employee well enough for him or her to be able to return to work, even if the employee has exhausted leave allowance.  The employer, however, cannot require an unpaid leave of absence if the employee can work with a reasonable accommodation.  The employer is also not required to provide an indefinite leave of absence as a reasonable accommodation.

Further, since the pandemic, employers have found that telework has become feasible for more job positions as a possible reasonable accommodation.  If the job position lends itself to telework, this is another possible temporary accommodation to consider.

  1. Failure to recognize employer’s ongoing obligation to engage in the interactive process

In general, it is the responsibility of the individual with a disability to notify the employer that he or she needs an accommodation, and initiate the reasonable accommodation interactive process.  However, even in the absence of such notification, the employer must inquire whether an employee with a known disability is in need of a reasonable accommodation.  Awareness of a potential need for accommodation could be imputed to the employer from such sources as a physician’s note or conduct observed by co-workers, and thus trigger the employer’s duty to engage in the interactive process.   Importantly, once a reasonable accommodation is agreed upon, that does not end the employer’s obligation to engage in the interactive process.  The accommodation provided should be reviewed periodically to ensure that it is still reasonable and remains effective in allowing the employee to perform the essential functions of the job.

  1. Failure to consider all vacant positions for reassignment

    Reassignment to a vacant position should be considered in these circumstances: (1) accommodation within the individual’s current position would pose an undue hardship; (2) the employee can no longer perform the essential functions of the current position even with accommodation; (3) if both the employer and employee agree that reassignment is preferable; or (4) if the employee so requests.

The employee with a disability is entitled to preferential consideration for assignment to a vacant position over other applicants and incumbent in-house candidates, unless doing so would violate a bona fide seniority system.

  1. Failure to analyze the undue hardship defense thoroughly

    Undue hardship is an ADA and FEHA defense to the employer’s obligation to provide reasonable accommodation to a disabled employee.  The employer must affirmatively show that a requested accommodation creates an undue hardship.  While the employer may consider the impact of an accommodation on the ability of other employees to do their jobs, the employer may not claim undue hardship solely because providing an accommodation has a negative impact on other employees, such as triggering accusations or complaints that the disabled employee is receiving “special treatment.”  Employers will sometimes also cursorily conclude that the requested accommodation is too expensive and would cause financial difficulty and therefore is an undue hardship.  However, financial difficulty per se is not enough.  There are numerous factors, including cost, which must be evaluated in the context of each employer (e.g., cost vs. the employer’s budget or financial ability), when evaluating an undue hardship defense.  Employers should review all the ADA and FEHA factors and carefully analyze whether a requested accommodation would cause undue hardship.  Keep in mind that hardship is not enough to justify denying accommodations.  The hardship must be “undue.”  The hardship must create a significant difficulty or expense to the employer.  In enacting the ADA and FEHA requirements, Congress and the California legislature intended that some hardships must be shouldered by employers in order to accommodate disabled employees and applicants.

We are excited to announce a new video series designed especially to serve our public safety clients. Our short Public Safety Video Briefings will tackle cutting-edge issues and core principles relevant to public safety employers. We hope you find these videos useful and thought-provoking.


This article was originally published in June 2014.  The information has been reviewed and is up-to-date as of August 2021.


Retirement-Sign.jpgIt is a common phrase that most in the public sector have heard of – a “PERS audit.”  However, despite having heard of CalPERS (“PERS”) audits occurring, many have not experienced an audit firsthand and are unfamiliar with what PERS audits entail.

CalPERS’ Office of Audit Services performs comprehensive reviews of public agency employers.  Part of that review function includes regularly conducting audits of public agencies.  These audits cover a wide range of issues such as reporting of special compensation, payroll processes, retired annuitant issues, part-time employee enrollment, and independent contractor designation.  There are multiple factors that prompt an audit by PERS.  PERS has an internal risk assessment ranking of agencies and may select an agency for an audit based on ranking.  Other factors may include media reports and “tips” provided to PERS.

If your agency is selected for an audit, PERS will provide a notice of the upcoming audit in writing.  PERS will then contact your agency to schedule on-site fieldwork visits and request various relevant documentation related to the audit, some of which will be produced before the visit and some of which will be produced during the visit.  Relevant documentation may include payroll records from a selected employee sample, labor agreements, employment contracts, and policies and procedures.  The on-site field work at your agency may last from a few days to a few weeks.

After PERS conducts its on-site field work and review of documentation, PERS prepares a draft audit report for the agency to review and respond.  It may take up to one year or more after the last on-site visit for the agency to receive the draft audit report.  The draft report will include each of PERS’ proposed findings on each issue audited, and the facts and documents that it relied upon to reach the findings.  The agency will then be allowed to prepare a comprehensive response to the draft audit report.  The response may identify errors and remedy any deficiencies in the draft report.  The response to the draft report is an important opportunity for the agency to address and comment on the audit report because the agency’s response will be included as an appendix to the final report.

Typically, within 3-6 months after receiving the agency’s response to the draft audit report, PERS provides the agency with a final audit report.  The final report is a public document and is posted on PERS’ website.  After the final report is issued, if the findings in the audit report demonstrate failings on the part of the agency, individual departments at PERS continue to work with the agency to develop a corrective action plan regarding the findings.  If PERS and the agency are unable to resolve the failings through a corrective action plan, PERS issues directives to the agency in line with the findings.  The agency may appeal the directives.  An administrative law judge hears the appeal and issues an advisory decision to the PERS Board for a final decision.  It could take several years from the date of filing the appeal to receive a final decision.  The agency may appeal the final decision in Superior Court.

It is important now more than ever for public agencies to be aware of potential issues that may arise if PERS conducts an audit.  Employers should consider reviewing its labor agreements, payroll practices, employee designations, and policies and procedures as part of an internal audit to ensure it is in compliance with the Public Employees’ Retirement Law.