Tag Archives: feha

Risky Spots for EPL Suits by Employees

A new study of employment practices litigation (EPL) data by Hiscox found four states — California, Illinois, Alabama and Mississippi — along with the District of Columbia, to be the riskiest areas of the U.S. for employee lawsuits. Businesses in these five jurisdictions face a risk that is substantially higher than the national average for being sued by their employees.

According to the study, a U.S.-based business with at least 10 employees has a 12.5% chance each year of having an employment liability charge filed against it. California has the most frequent incidences of EPL charges in the country, with a 42% higher-than-average chance of being sued by an employee. Other high-risk jurisdictions include the District of Columbia (32% above the national average), Illinois (26%), Alabama (25%), Mississippi (19%), Arizona (19%) and Georgia (18%). Lower-risk states for EPL charges include West Virginia, Massachusetts, Michigan, Kentucky and Washington.

Bert Spunberg, a colleague at Hiscox who is a senior vice president and the practice leader for executive risk, says: “Federal level information on employee charges is generally available, but state specific information is more difficult to aggregate. Understanding employee litigation risk at a state level is a crucial step for an organization to establish the processes and protections to effectively manage their risk in this changing legal environment.”

State laws can have a significant impact on risk. For example, the employee-friendly nature of California law in the area of disability discrimination may contribute to the high charge frequency in the state. Discrimination cases filed at the state level in California are brought under the Fair Employment and Housing Act (FEHA). FEHA applies to a broader swath of businesses, covering any company with five employees, vs. a 15-employee minimum for cases brought under federal law as outlined in Title VII of the Civil Rights Act.

Mark Ogden, managing partner of Littler Mendelson, the largest employment and labor law firm in the world, says: “Not only are employment lawsuits more likely in those states, but the likelihood of catastrophic verdicts is also significantly higher. Unlike their federal counterparts, where compensatory and punitive damages combined are capped at $300,000, most state employment statutes impose no damages ceilings. Consequently, employers in high-risk states must ensure that their workforces are adequately trained regarding workplace discrimination, harassment and retaliation and that policies forbidding such conduct are strictly enforced.”

For more on the study, click here.

Involuntary Reassignments And Transfers As An Unlawful Employment Practice

Effective December 30, 2012, the California Department of Fair Employment & Housing has a whole new set of disability discrimination regulations to enforce under the Fair Employment & Housing Act (FEHA). The regulations govern the rights of job applicants and employees with disabilities in every aspect of the employment relationship, from recruiting and hiring, to terms and conditions of employment, performance management, discipline, and discharge. And of course a primary focus is the mandated timely, good faith interactive process for evaluating and implementing reasonable accommodations in the workplace.

A significant emphasis in the FEHA, and the new regulations, involves defining unlawful employment practices — particularly those that result in adverse employment consequences to an applicant or employee based on a disability. The new FEHA regulations add “involuntary transfer or reassignment” to the list of potential adverse employment actions for which an employee can make a disability discrimination claim, which may have a significant impact on school districts as employers.

Administrators will soon begin making staffing decisions that involve involuntary reassignments for the coming school year. They should be aware of the impact the disability regulations may have on their decision making process. This is particularly important in situations where the district either has been on notice that the affected employee has a disability, or one of the factors in choosing the employee for the reassignment involves disability-related issues (such as erratic attendance due to the condition, prior use of medical leave, or prior requests for accommodation).

This article provides further explanation about this issue and the anticipated impact on California school districts. In addition, this article draws a distinction between involuntary reassignments and reassignments that are offered during an interactive process as a reasonable accommodation.

What Is An “Adverse Employment Action?”
An employer may not take any “adverse employment action” against an employee on the basis of a “protected characteristic” such as race, gender or sex, religion, national origin, pregnancy, physical or mental disability, or medical condition. Adverse employment actions consist of decisions that materially affect the terms and conditions of the individual’s employment. Common adverse employment actions include:

  • Refusal to hire an otherwise qualified job applicant because of the protected characteristic;
  • Disciplinary action that leads to suspension, loss of pay or benefits, or job status change;
  • Demotion or an unfavorable transfer to a materially different position;
  • Denial of promotion or advancement;
  • Failure to engage in an interactive process to evaluate reasonable accommodations;
  • Failure to make a reasonable accommodation; and
  • Termination or discharge.

An adverse employment action is an action that materially affects the terms, conditions, or privileges of employment. Whether the action is “material” is viewed from an objective perspective. Relatively minor actions that are reasonably likely to simply anger or upset an employee do not constitute an adverse action. An adverse employment action is adverse treatment that is reasonably likely to impair a reasonable employee’s job performance or prospects for advancement or promotion.

In retaliation cases, both federal and state courts have broadened the range of what constitutes an adverse action, concluding that an action is also material if it is reasonably likely to deter an employee from engaging in protected activity. In Yanowitz v. L’Oreal USA, Inc., the California Supreme Court reviewed an employee’s unlawful retaliation claim under the FEHA. In Yanowitz, the alleged retaliatory conduct included unwarranted negative performance evaluations, unwarranted criticism voiced by a supervisor in front of other employees, and a supervisor’s solicitation of negative feedback from the plaintiff’s staff. Thus, depending on the circumstances, lateral transfers, unfavorable job references, and changes in work schedules may constitute adverse employment actions.

Involuntary Transfer Or Reassignment Is An Adverse Employment Action

Prior to the recent adoption of new regulations, the list of potential “adverse actions” did not specifically include involuntary transfers or involuntary reassignments. The Fair Employment & Housing Commission added this as a specified unlawful employment action based largely on the case law that has emerged over the last few years. The Department of Fair Employment & Housing observed that many times employees claimed that they were transferred or reassigned against their will to less desirable positions because of their protected characteristic (e.g. gender, race, religion, age, disability, etc.) or in retaliation for engaging in protected activity.

A retaliation lawsuit in San Diego specifically focused on an involuntary transfer as an “adverse employment action.” In Coyne v. County of San Diego, the employee sued for discrimination and retaliation in violation of Title VII and the California FEHA. The plaintiff claimed that she was transferred to a lateral position in a different division because of her gender and because she actively supported the gender discrimination claims of other employees. The County conceded that the plaintiff had engaged in protected activity, and the issues were whether the transfer constituted a materially adverse employment action and whether the transfer was justified by legitimate non-discriminatory reasons.

In analyzing the facts, the district court concluded that that a jury should decide whether the transfer was an adverse employment action. First, assignment to the new division was perceived by the County’s employees as less prestigious, unfavorable and, at times, punitive. Second, the transfer interfered with the plaintiff’s ability to care for her disabled son because it lengthened her commute. The judge found that the County knew that the plaintiff needed to care for her disabled son and that her current assignment was more conducive to that need. Because the plaintiff met her initial burden of proving the elements of retaliation, the burden shifted to the County to offer a legitimate non-discriminatory reason. The County offered more than one legitimate non-discriminatory reason for the transfer. The plaintiff, however, offered evidence that the County’s reason for the transfer shifted over time from one reason to another. The court concluded that the shift from one reason to another was sufficient to create an issue of fact for a jury about whether the non-discriminatory reasons offered by the County were pretexts for unlawful discrimination and retaliation.

It is clear that any “involuntary” transfer or reassignment will now be subject to an employee claiming that the decision was made, in whole or in part, for discriminatory motives and not for legitimate non-discriminatory business reasons. With the very broad definition of disability, it is likely that many certificated and classified employees fall within the protections FEHA offers for disability and medical conditions. Given the fluctuating needs of California school districts to make staffing decisions based on budgetary, enrollment and other key criteria, we can also anticipate that more reassignments and transfers will be necessary. Accordingly, this will have an immediate impact on districts as they staff for the next school year.

Impact On School Districts With Involuntary Transfer/Reassignments
Most school district collective bargaining agreements have provisions addressing criteria for transfers or reassignments. Bargaining unit members are eligible for any position for which they are appropriately credentialed or qualified using the process outlined in the collective bargaining agreement. And, most provide that any reassignment or transfer is subject to the District finding an appropriately credentialed teacher or qualified individual to fill his/her position.

The agreements also typically address the circumstances under which an involuntary transfer (to another site) or reassignment (to a different position at the same site) may be made. A reassignment or transfer may be necessary due to a shift in student population resulting in a decline or increase of enrollment at grade levels or departments, reduction of programs, initiation or expansion of programs, opening of a new school, or for the legitimate needs of a specific program. The criteria set forth in the contract are very important because they will form the criteria for defending an involuntary reassignment as a legitimate, non-discriminatory decision.

Most agreements also have a provision that first seeks voluntary requests for a transfer or reassignment to a posted vacant position. If there is no interest, then the district has the right to invoke the involuntary transfer or reassignment process. The very nature of “involuntary” suggests that the person who is reassigned (who expressed no interest in the position when posted) will be unhappy. In the past, employees and their union representatives generally invoked whatever remedies the collective bargaining agreement provided to contest an involuntary transfer. Now, districts can expect that when an unhappy employee is involuntary transferred or reassigned, even within the boundaries of a governing collective bargaining agreement, s/he may also claim that the decision was made in whole or in part, on a disability, medical condition or perceived disability and not non-discriminatory business reasons.

The Employee’s Initial Burden Of Proof
If an employee sues for disability discrimination alleging that an involuntary reassignment was based on disability, s/he must provide evidence that the disability played some role in the decision. Once that initial burden is met, the burden of proof shifts to the district to prove that the business decision was based on objective job-related criteria and that it was a legitimate non-discriminatory decision. It will, therefore, be very important for districts to establish, with clear and objective evidence, the business-related basis for involuntary reassignments.

To establish a disability discrimination claim in California, the employee must have a covered disability and must still be able to perform the essential functions of the job with or without accommodation. Treating an employee adversely in hiring, advancement, performance appraisal, termination, compensation, job training, and other terms, conditions, and privileges of employment because of a disability violates the California FEHA. Also, taking adverse employment actions against an employee because of a perceived disability or limitation violates FEHA, whether or not the impairment actually limits a major life activity.

To prove disability discrimination, the employee must prove the following elements:

  1. S/he has a physical or mental disability or medical condition, as those terms are defined in the law (and the new regulations);
  2. S/he is qualified for the position she seeks or holds, meaning that s/he is able to perform the essential job functions with or without reasonable accommodation;
  3. The district denied an equal employment opportunity by taking an adverse action against him/her; and,
  4. A “causal connection” between the individual’s disability or perceived disability and the denial of an employment opportunity. In other words, the decision was based, at least in part, on the disability, medical condition or perceived disability.

An adverse employment action can be proven through direct evidence or by inference. For example, when an employee alleges she was involuntarily reassigned because of her disability, the employer’s discriminatory motive can be shown by establishing that the employee was reassigned due to factors related to his/her disability (such as irregular attendance due to the condition or other factors involving physical capacity, etc.). The evidence need not show that the disability or medical condition was the sole, or even the dominant motivation for the adverse action. Rather, discrimination is established if the preponderance of the evidence indicates that the claimant’s disability or medical condition was at least one of the factors that motivated the decision that led to an adverse employment action.

The District’s Burden Of Proof To Defend An Involuntary Reassignment
As noted above, FEHA provides a “mixed motive” basis for establishing discrimination claims. Once the plaintiff provides “some evidence” that one or more of the reasons for an adverse employment decision was based on a protected characteristic, the burden shifts to the defendant to prove that it had a legitimate non-discriminatory reason. These reasons can vary with the individual circumstances. The criteria for making involuntary transfers or reassignments set forth in a collective bargaining agreement will certainly be a starting point — particularly since they apply to all similarly situated members of the bargaining unit.

Districts should be prepared to produce concrete, objective reasons for making an involuntary transfer and why the particular employee with a disability was the appropriate person to select. Often, this can be based on factors such as appropriate credentials, seniority, or other objective factors.

Also, if the decision makers on the reassignment were unaware of the individual’s disability, then the district can defend by establishing that the decision could not have been based on the disability or aspects of the disability. However, districts should also be prepared for the potential that an involuntarily reassigned individual with a previously undisclosed disability requests a reasonable accommodation that would: (a) invalidate the reassignment or transfer so the employee can remain in the current assignment; (b) seek to identify modifications or adjustments needed to perform in the new position or at the new site; (c) seek to identify a different reassignment (to a different vacant position) be considered as a reasonable accommodation; or, (d) request leave as a reasonable accommodation rather than to complete the involuntary reassignment or transfer.

All of these requests will trigger an interactive process that must be completed and well documented. It will not be sufficient to assert that the collective bargaining agreement provisions on involuntary transfer or reassignment is controlling. Remember that modifying or bypassing a provision of a collective bargaining agreement to make a reasonable accommodation must at least be considered as part of an interactive process. And, when the collective bargaining agreement states that seniority is “one factor” to consider in making an involuntary reassignment, it does not constitute a “bona fide seniority system” because it leaves some discretion and flexibility to balance a number of legitimate business factors in making staffing decisions.

Distinction: Involuntary Reassignments Versus Reassignments As A Reasonable Accommodation
This article addresses involuntary reassignments or transfers which are made outside of an interactive process. This is very different from making a reassignment to a vacant position as part of a reasonable accommodation, to better suit the employee’s needs for modified schedule or adjustments to physical tasks such as standing, walking, etc. Such decisions are made properly in the context of an interactive process. Although an employee may not “welcome” a reassignment, that isn’t the same as an involuntary reassignment prior to (or in the absence of) a timely good faith interactive process.

In the context of an interactive process, after considering potential alternatives to effectively accommodate an employee with modifications or adjustments to his regular job or other environmental changes, a school district may conclude that a reassignment to a “comparable” vacant position for which he is qualified offers the best opportunity to reasonably accommodate his work restrictions. As long as the interactive process explores in good faith all options for reasonable accommodation, the reassignment can be defended even if this is not the employee’s preferred accommodation. It is important, however, to be sure the reassignment is to a comparable position that the employee can perform and to have a constructive dialogue with the employee to obtain his/her agreement on the reassignment as a reasonable accommodation.

In fact, reassignment to a vacant position as part of a reasonable accommodation is required when the employee cannot perform his own job even with an accommodation. Reassignment as a reasonable accommodation received specific attention in the new regulations. The regulations provide: “As a reasonable accommodation, employer shall ascertain through an interactive process suitable alternate, vacant positions and offer an employee such a position for which the employee is qualified under the following circumstances:

  • Employee can no longer perform essential job functions, even with accommodation;
  • Accommodation of the essential functions of own job creates an undue hardship; and
  • Agreement with employee that reassignment is preferable to accommodation in U&C.

If no funded, vacant comparable positions for which the employee is qualified with or without reasonable accommodation exists, the employer may assign to a lower graded or lower paid position. Although reassignment to a temporary position is not considered a reasonable accommodation under these regulations, an employer may offer and an employee may choose to accept or reject a temporary assignment during the interactive process (Interactive process is continuous — so the intent is to make this a “stop gap”).

Most significantly, the new regulations make it clear that reassignment as a reasonable accommodation is a very high level responsibility for employers. The regulations specify: “The employee with a disability is entitled to preferential consideration of reassignment to a vacant position over other applicants and existing employees. However, ordinarily an employer is not required to accommodate an employee by ignoring a bona fide seniority system absent a showing that special circumstances warrant a finding that the requested accommodation is reasonable on the particular facts, such as where the employer reserves the right to modify its seniority system or the established practice is to allow variations to its seniority system.”

Workers' Compensation In California: No Longer Just Permanent And Stationary

Senate Bill 863 was passed on August 31, 2012 and signed into law by Governor Brown on September 1 for a January 1, 2013 effective date. This bill not only affects the workers’ compensation system in California but also has far reaching effects for employers under the California Fair Employment and Housing Act (FEHA) and the Americans with Disabilities Act of 1990 (ADA). With lengthy delays for treatment and outcomes, the old system wasn’t working.

In this author’s opinion, the most significant issues that employers face with the changes in SB 863 are with the supplemental job displacement vouchers, increases in permanent disability, and the independent review process.

The bill increases permanent disability and an independent medical review process (IMR), which may be problematic for an employer because claims that are not causally related or where there is no injury accepted can have a significant impact on the employer. In fact, an independent medical review can only be requested by an injured worker following a denial, modification, or delay of a treatment request through the utilization review (UR) process. The catch is that employers and insurance carriers cannot request review of treatment authorizations.

There is a right to appeal an independent medical review determination to the trial level Workers’ Compensation Appeals Board on the basis of fraud, conflict of interest, or mistake of fact. The reviewer’s underlying medical decision-making, however, cannot be overturned by a judge. The remedy, if an appeal is granted, is a referral to a different reviewer for another evaluation. In short order, the employer is stuck with the decision. Please note that this does not apply if the injury is in question!

What does this mean in terms of federal law for California?

To best answer this question one must understand the basis of these federal laws. Numerous states have anti-discrimination laws which can differ from federal law but are designed to encompass the spirit of the federal laws. These laws are provided in addition to the federal law in order to offer more desirable avenues for victims of harassment and discrimination. California is one state that has enacted such laws.

For the purpose of SB 863, we need to explore the California Fair Employment and Housing Act. This law prohibits discrimination based on race, color, religion, national origin, physical or mental disability, medical or related medical condition, marital status or sexual orientation. The act applies to all employers, labor organizations, employment agencies and any other entity or person who engages in or compels an act of discrimination. It also allows for the imposition of punitive damages when a corporate defendant’s officers, directors or managing agents engage in harassment or discrimination. In fact, the definition of disability under the California Fair Employment and Housing Act is more broad than Federal law as something that “limits” a major activity where the federal law states that it must “substantially limit” a major activity.

The enactment of SB 863 will pose an important question for employers; “where does workers’ compensation end and discrimination start?” As of January 1, 2013, California employers need to have the answer to that question because newly added Labor Code Sec. 4658.7 addresses that problem and ties into SB 863.

Under the current system, injured workers may be offered supplemental job displacement vouchers that can be used to pay for job retraining. Currently, the vouchers range from $4,000 to $10,000 and the permanent disability award is often determined a long time after the last date of temporary disability payable, so the use of the vouchers has been low. The amount is based on the permanent disability rating for the injured worker and does not have to be paid until a final determination of the permanent disability rating has been determined.

For injuries after January 1, 2013, under SB 863 the voucher amount will be fixed at $6,000 for all qualifying injured workers, and it is to be offered when the injured worker reaches permanent and stationary status and the treating doctor reports on work abilities and limitations resulting from the injury.

With Labor Code 4658.7, the trigger for a voucher will be when an employer does not offer regular, modified or alternative work within 60 days of receipt of a P&S report finding that the injury has caused permanent partial disability. Under state and federal law, employers must provide “reasonable accommodations” for disabled workers. This obligation includes a requirement to engage in a good faith “interactive process,” in which the parties discuss the employee’s limitations and explore possible accommodations.

A good case in point is the $1,571,500 lesson learned in Cuiellette v. City of Los Angeles (California Court of Appeal, Second Appellate District, 4/22/11). The significant point from this case is that if an employee seeks reassignment as a reasonable accommodation, the employer must consider if the employee can perform the essential duties of the position sought, rather than those of his current or prior position.

The only way for an employer to level the playing field and avoid potential landmines is with objective baseline testing such as the Electrodiagnostic Functional Assessment Soft Tissue Management baseline program, which provides employers the data necessary to only accept claims that arise out of the course and scope of employment.

Employer Alert: 2013 Legislative and Regulatory Expansion under California FEHA

On June 28, 2012, Governor Brown signed a budget reconciliation bill that made widespread changes to the organization of many state agencies. Buried in the 160 page bill are very significant amendments to the California Fair Employment & Housing Act (FEHA), which is the comprehensive statutory framework for California’s prohibition on categories for discrimination, harassment and retaliation in employment and housing. The Department of Fair Employment & Housing (DFEH) is the agency that enforces these anti-discrimination standards.

Among the key administrative changes, effective January 1, 2013, the FEHA amendments will:

  • disband the Fair Employment and Housing Commission (FEHC), which was the agency that adopted regulations and acted as the judicial body that conducted evidentiary hearings for accusations of discrimination brought before the commissioners instead of in a civil court;
  • expand specified powers of the DFEH related to complaints, mediations and prosecutions;
  • eliminate a specified cap of actual damages under FEHA (in particular the cap of $150,000 on emotional distress damages when raised in an administrative accusation rather than a civil action);
  • mandate mediation of discrimination, harassment or retaliation charges, at no cost to the parties, but with beefed up penalties for violating any agreement reached by way of alternative dispute resolution;
  • require that certain actions be brought in court by civil action, rather than by “administrative accusations” previously heard by the FEHC;
  • transfer the responsibilities for adopting regulations to the DFEH, through an internal council;
  • shift the venue for claims for emotional distress damages that are pending before the Commission to be tried in Superior Court (subject to agreement of the parties, although how that will operate is ambiguous at this point). Other claims may be heard before an administrative law judge rather than the Commission;
  • New claims, filed on or after January 1, 2013, that the DFEH elects to bring on behalf of individuals or a class of aggrieved employees, may be brought to civil court by the DFEH.

These administrative changes will have potentially profound impact on how every charge of discrimination is investigated, mediated or prosecuted. It could also result in increased risks for hefty damage awards against employers. Consider the contrast between some recent FEHC administrative awards compared to damage verdicts assessed by jurors in civil lawsuits the FEHA:

Fair Employment & Housing Commission Administrative Awards

  • DFEH v. Air Canada — The Commission found violations of FEHA for terminating a customer service agent because of her disability; failing to provide reasonable accommodations; ignoring the employee’s attempts to communicate with the company to return her to work; and ignoring its own accommodations and leave policies. The Commission awarded $102,737.60 in back pay, $19,720 in lost benefits, reinstatement to the same or comparable position, front pay from the first day of the hearing to the date of reinstatement, $125,000 in emotional distress damages, and $25,000 administrative fine.
  • DFEH v. Avis/Budget — The Commission found in favor of a customer service representative at SFO airport because Avis failed to engage in the interactive process, delayed in communicating, made unlawful inquiries about the employee’s disabilities when it initially required her to release her psychiatric medical file or submit to a medical examination, placed her on involuntary leave and failed to reasonably accommodate. The award was $89,863.70 ($14,863.70 back pay & $50,000 emotional distress), plus a $25,000 administrative fine
  • DFEH v UPS — Commission found in favor of a UPS employee who handled customer calls and complaints on shipments. She was allegedly denied a reasonable accommodation and fired based on an inflexible maximum leave policy. FEHC awarded a total of $96,170 representing $31,170.00 in lost wages, $25,000 in emotional distress and a $10,000 administrative fine, plus interest and future wages.
  • DFEH v Acme Electric
    — This case is a notable exception for administrative awards being significantly lower than jury awards in comparable cases. In 2011, the DFEH obtained the largest-ever administrative award of $846,300 against Acme Electric for firing a sales manager who requested limitations on his travel requirements after returning from leave for kidney and prostate surgeries and while still undergoing treatment. The Commission found Acme failed to reasonably accommodate his known travel limitation due to his cancer treatments, failed to engage in a good faith interactive process and failed to take all reasonable steps necessary to prevent discrimination from occurring. The DFEH awarded the employee $748,571 for lost wages, $22,729 for out-of-pocket expenses and $50,000 for emotional distress.

Note: FEHC had power to award damages for emotional distress up to $150,000 per aggrieved person under Govt. Code section 12970(a)(3). In contrast, employees suing in civil court can — and do — often obtain hefty awards for their emotional distress, pain and suffering. Likewise, civil litigants who sue and prevail under FEHA may recover their reasonable attorneys’ fees and costs, even if their “win” is for a lot less than they asked from the jury. Until now, DFEH, which prosecuted administrative actions on behalf of employees before the commission, did not recover attorneys’ fees and/or litigation costs, because all of the matters were handled internally within the agency. This new legislation changes this system and authorizes the DFEH to pursue civil lawsuits on behalf of aggrieved parties and seek comparable remedies. The amendments do not change the remedies and requirements for individuals whom the DFEH elects not to represent; but may choose to expand on investigations and mediations in many of those matters prior to issuing a Right to Sue Letter, which is the trigger for the individual to engage counsel for their own civil lawsuit.

Contrasting Jury Verdicts in Civil Lawsuits

  • Wysinger v Auto Club: The jury found that the employer failed to engage in an interactive process when an employee requested a transfer to a different office that would limit his commuting time, due to his disability, although it also concluded that the requested transfer would not have been a reasonable accommodation. The jury award that was upheld on appeal: $2.26 million: (representing $204,000 in economic damages for lost wages; $80,000 non economic damages; $1 million punitive damages; and $978,791 reasonable attorneys’ fees as an item of damage.
  • Schermerhorn vs. Los Angeles Unified School District: a teacher had hip replacement surgery for an industrial injury. He asked to return to work with temporary restrictions before he had reached his maximum medical improvement, but was repeatedly rebuffed. He prevailed on his claims for disability discrimination and failure to engage in the interactive process to consider reasonable accommodations. The award, also upheld on appeal (in an unpublished decision) was $971,750 (representing $380,306 compensatory lost income and emotional distress; $21,836 costs and $568,108 in plaintiff’s attorneys’ fees as an item of damage.
  • Jones v Lodge at Torrey Pines: Jones brought an action against his former employer and his former supervisor for harassment and discrimination based on sexual orientation and retaliation. After his harassment claim was dismissed, the jury returned a verdict on the discrimination and retaliation claims, awarding compensatory damages of approximately $1.4 million against the Lodge and $155,000 against the supervisor individually. The judge set aside the verdict against the supervisor, holding that she could not be held liable for retaliation under the FEHA. The Court of Appeal reversed and the Supreme Court overturned that appeals court. The Supreme Court noted that individual supervisors can avoid engaging in harassment and, therefore, it is fair to subject them to personal liability for harassment. However, in the case of discrimination and retaliation, which involve job actions, supervisors cannot avoid making the personnel decisions which are allegedly discriminatory or retaliatory. These are often joint decisions made by more than one person such that it would be difficult to apportion blame. Nevertheless, the jury’s award against the Lodge was upheld on appeal.
  • Cuiellette v. City of Los Angeles: a jury awarded a Los Angeles Police Department officer $1,571,500 on his claim that he was denied a reasonable accommodation after he asked to return to a lighter duty position following the resolution of his workers’ compensation claim.
  • Bradley v. Department of Corrections: A licensed social worker who was assigned temporarily by a hiring registry to a state prison, where she was subjected to sexual harassment and retaliation, was an employee of the state for the purposes of FEHA even though she was not a state employee under civil service and benefits standards. A jury found that she was subjected to sexual harassment by the prison chaplain and that the prison officials failed to investigate her claim, failed to take corrective action and retaliated against her by firing her in response to her complaints. The jury awarded her $744,000 in damages and attorneys’ fees, which were upheld by the Appeals Court. ($300,000 non economic damages; $87,000 past economic damages; $50,000 “non-duplicative” past economic damages on her retaliation claim; $2,000 future economic damages on the harassment claim and $305,000 attorneys fees as damages).

The legislation is new and it will take some time to digest the changes and to identify where employer policies and procedures will require updating. DFEH will be holding a webinar addressing these changes to their regulatory and enforcement powers on July 25, 2012.

Before it is disbanded, the FEHC is expected to adopt expansive new regulations governing disability discrimination charges and workplace accommodations for pregnant employees. DFEH will handle enforcement and future rulemaking. At its meeting on June 13, 2012, the FEHC made several changes based on public comments. The second public comment period ended on 7/3/12. The regulations, effective on January 1, 2013, significantly expand who is entitled to reasonable accommodations and what employers must consider in making decisions. For example, “essential job functions” must be based only on tasks actually required, as reflected in recent performance evaluations or current job descriptions. The scope of pregnancy-related conditions requiring accommodation is broader. The list of disability accommodations to consider has doubled.

Trucking Company Pays $450,000 to Settle Fresno Workplace Discrimination Case

California’s Department of Fair Employment and Housing (DFEH) settled a group action lawsuit on behalf of newspaper delivery drivers against Penske Logistics, LLC for $450,000. The DFEH alleged that Penske refused to hire the drivers because of their real or perceived disabilities. The case arose after Penske entered into a contract with the Fresno Bee to deliver newspapers. The Bee informed its newspaper delivery drivers that it had outsourced their jobs to Penske, and advised them that they could apply for employment with Penske if they so desired. When the drivers applied, Penske required them to disclose non job-related physical conditions, which is prohibited. Penske also rejected several drivers due to the conditions they disclosed.

The DFEH lawsuit alleged that Penske rejected 13 of the delivery applicants who had ably performed their jobs for the Fresno Bee for four or more years, after they received unsatisfactory scores on Penske’s Physical Capabilities Exam. According to the Department, the exam was neither job-related nor consistent with business necessity, which the Fair Employment and Housing Act (FEHA) requires. Prohibited disability-related questions included whether an applicant has heart disease, diabetes, or high blood pressure. The exam also required applicants to achieve a strength rating of “medium-heavy,” while the U.S. Department of Transportation standard Penske claimed to follow assigns a strength demand of “medium” to a wholesale newspaper delivery driver job. The Department alleged that because the 13 applicants did not achieve the artificially high strength demand Penske required, Penske refused to hire them, although they had safely and successfully performed the duties of a newspaper delivery driver for the Fresno Bee for years.

In addition to paying $450,000 to the 13 applicants, Penske agreed to stop subjecting applicants at any of its facilities in California to the Physical Capabilities Exam, to maintain and distribute a written policy prohibiting workplace discrimination on the basis of actual or perceived disability, to train its officers, managers, supervisors and Human Resources personnel in California on the policy, and to maintain and distribute written procedures by which current and prospective employees in California may report discrimination.

This is not the first time the DFEH has challenged a pre-employment test. In a class action against Loma Linda University Medical Center, the agency negotiated a settlement for $259,853.96 on behalf of ten job applicants, for subjecting candidates to a “nerve conduction test” to screen out those who have or may have carpal tunnel syndrome or repetitive motion injuries. The applicants who were required to take this test had passed all other employment tests and interviews. In some cases, job applicants had already attended orientation and were ready to start work. The hospital rescinded its employment offer to applicants with “failing” test results, even though there was no objective evidence demonstrating that they could not perform their essential job tasks. These two settlements suggest that the DFEH is paying increased attention to discrimination based on “actual or perceived disabilities,” and starting in 2013 will be able to file class lawsuits in civil court.

Prevention Strategies: The new disability discrimination regulations that will take effect on January 1, 2013 emphasize “accurate and current job qualification requirements.” DFEH is clearly starting to enforce this now. The enforcement agency is taking the position that not only was there disability related inquiries, but that rejection of the applicants was “regarded as disabled” discrimination. Accordingly, it is prudent to take a look at the current pre-employment testing protocols to be sure that they are within appropriate guidelines under FEHA (job related and consistent with business necessity) and that any post-conditional offer medical examinations only ask for appropriate job-related medical history.