Court of Appeal: Sexual Harassment Claim Untimely

You have to file an administrative charge with the Department of Fair Employment and Housing within a year of the last act about which you claim is harassment, discrimination, or retaliation. So, when Irene Trovato testified at her deposition that the last time Michael Allyn harassed or retaliated against her was January 31, 2007, the charge she filed on May 8, 2008, was untimely.

In opposition to her employer's and Allyn's summary judgment motion, she submitted a declaration under penalty of perjury in which she said that the harassment continued until she left her employment in May 2007 (which would have rendered her charge timely fled). But, she contradicted her clear deposition testimony, which you cannot do.
Then, Trovato claimed the "continuing violation doctrine," which has gutted the statute of limitations in these types of cases, rendered her claim timely.  But the court of appeal said the doctrine did not apply:

 The case is Trovato v. Becton Coulter, Inc. and the opinion is here.

Trovato also argues that she still reported to Allyn after January 31, 2007, until she resigned in May 2007, and that this assignment alone—without any other evidence—was sufficient to constitute harassment or retaliation. There is no authority for this argument, and its acceptance would extend the statute of limitations indefinitely.

The conclusory statements in Trovato’s declaration are not sufficient to raise a triable issue of material fact on the statute of limitations issue, and she cannot defeat the grant of summary judgment by contradicting her sworn deposition testimony on material points in a later-filed declaration. (Shin v. Ahn (2007) 42 Cal.4th 482, 500, fn. 12; D’Amico v. Board of Medical Examiners (1974) 11 Cal.3d 1, 22; Whitmire v. Ingersoll-Rand Co. (2010) 184 Cal.App.4th 1078, 1087.)

California Court Again Holds California Pro-Picketing Law is Unconstitutional

The Third District Court of Appeal previously held that California's statutes prohibiting courts from enjoining most union picketing are unconstitutional. See my earlier post here.  The California Supreme Court granted review in that case.

Now the Fifth District Court of Appeal has held the same thing, and involving the same employer, Ralphs Grocery, albeit at a different location.  Money quote:

Laws which prohibit speech based on its content — or, in this case, based on the failure of the speech to address a "labor dispute" — are presumptively invalid. (Simon & Shuster, Inc. v. Members of N.Y. State Crime Victims Bd. (1991) 502 U.S. 105, 116.) Such laws are permitted only if they serve a compelling state interest and are narrowly drawn to accomplish that interest. (Mosley, supra, 408 U.S. 92, 95.) The desire to provide the broadest forum for expression in labor disputes is not a compelling state interest. (Carey v. Brown, supra, 447 U.S. 455, 466.)
We conclude the state may not act to selectively create a free speech right applicable only to the few, while excluding all others, in the absence of a compelling state interest. As a result, we hold that the Moscone Act and Labor Code section 1138.1 contravene the free speech provisions of California Constitution article I, section 2, by discriminatorily conferring speech rights on some, but not all, Californians without a compelling state interest.

Read this one quickly because the Supremes likely will take it up along with the earlier Ralphs case.
The case is Ralphs Grocery Co. v. UFCW Union Local 8 and the opinion is here.

Ninth Circuit: WARN Act Opinion

The WARN Act requires companies to give at least 60 days' notice of shutdowns and mass layoffs that affect a certain number of people.  For example, to be covered, a "mass layoff" must involve an "employment loss" for a group comprised of at least 50 employees who constitute at least 1/3  of the workforce. 

The thing is, the law and regulations contain a number of exceptions and special definitions regarding who is an employee, who counts as a layoff, etc. There are so many moving definitions and exceptions, it is impossible (or maybe just dumb) to give WARN advice "off the cuff."

One of the key definitions is "employment loss" because that's how you tell how many employees are affected by a layoff or shutdown.  If < 50 employees have suffered an "employment loss" then federal WARN is not triggered.

So, in Collins v. Gee West, the employer was looking for a buyer and gave less than 60 days' notice of a shutdown.  Collins and other sued for the WARN damages due for failure to give 60 days' notice.
But the Company's notice was that the shutdown would occur on October 7. By that date, all the employees had quit for other employment.  The Company argued that these employees voluntarily departed before the October 7 shutdown date. Having voluntarily departed, they did not suffer an employment loss.

The district court bought that argument and granted the employer's motion for summary judgment. On appeal, not so much. The Ninth Circuit held that when folks leave employment after being told the business is going to shut down, that is not a "voluntary departure" exception to the "employment loss" definition. As the court pointed out, if that were the case, then the only way to tell whether a WARN notice was due would be after the fact.  So, the employer must reasonably calculate how many employees are anticipated to be affected by the employer's layoff or shutdown decision. The fact that an employee does not wait to the last day to leave does not eliminate the requirement of counting that employee as part of the layoff.

I figured there would be a discussion of the defenses to inadequate notice like the "faltering company" exception. Maybe next time.

The case is Collins v. Gee West and the opinion is here.


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Court of Appeal Upholds Wage Statement Penalties

So, several employees of Heritage Residential Care, Inc. "lacked social security numbers."  Naturally, the employer immediately fired them. 

No, silly, the employer re-classified them as independent contractors!   Because, after all, without social security numbers, the employer could not withhold taxes. And you have to withhold an employee's taxes.  But you don't have to withhold an independent contractors!  Brilliant! 

As you can imagine, since this has come to my attention over here, the employer's deft maneuver did not end well. Employees sued for penalties, among other things, because the employer did not provide adequate "wage statements" per Labor Code section 226. 

After losing before the Labor Commissioner, they sought review on whether the failure to issue compliant wage statements was "inadvertent."  If so, Section 226.3 permits the Labor Commissioner to take that into consideration in deciding whether to assess the penalties.

No sale. After a painstakingly thorough analysis of the meaning of "inadvertence," the court of appeal decided it simply means that it was unintentional.  Here, the employer intentionally chose to issue 1099 forms to these employees, because they lacked social security numbers. 

Therefore, employers who intentionally issue defective wage statements, or who skip issuing them on purpose, will not qualify for the statutory leniency built into Labor Code section 226.3. 

The case is Heritage Residential Care, Inc. v. DLSE and the opinion is here.

U.S. Supreme Court Recognizes Third-Party Retaliation Claims

Justice Scalia for a unanimous Supreme Court wrote that employees may claim retaliation when they are associated with someone ELSE who engaged in protected activity.  What?

Miriam Regalado was engaged to Eric Thompson. They both worked for North American Stainless.  So, Miriam filed a charge with the EEOC alleging sex discrimination. NAS fired Thompson three weeks later. 

Thompson then filed a retaliation charge. But Thompson did not actually engage in protected activity. Regalado was the one who filed with the EEOC. 

So, was it retaliation under Title VII to fire Thompson?  The Supreme Court said yes. Relying on the Court's expansive definition of retaliation set forth in Burlington N. & S. F. R. Co. v. White, 548 U. S. 53 (2006),the court said:

“the antiretaliation provision, unlike the substantive provision, is not limited to discriminatory actions that affect the terms and conditions of employment.” Id., at 64. Rather, Title VII’s antiretaliation provision prohibits any employer action that “well might havedissuaded a reasonable worker from making or supporting a charge of discrimination.” Id., at 68 (internal quotation marks omitted).

And of course, they found that firing a fiance "well might have dissuaded" the complainant from making or supporting a charge: NAS argued, where do you draw the line?  Trusted co-worker? Girlfriend? What third parties are close enough to the complainant.  The Court could not find any language in Title VII to support setting down a blanket rule.
 

We must also decline to identify a fixed class of relationships for which third-party reprisals are unlawful. We expect that firing a close family member will almost always meet the Burlington standard, and inflicting a milder reprisal on a mere acquaintance will almost never do so, but beyond that we are reluctant to generalize.

The court next decided that Thompson had standing to sue under Title VII because he was a "person aggrieved."  The Court knew it was opening a can of worms to let third parties sue. So, it limited Title VII standing to those covered by the "zone of interests" Title VII seeks to protect.  Thompson was an employee at the same company as his fiance, and, most importantly, according to the complaint, the company fired him for the purpose of hiring the fiance who filed the charge.
 
The case is Thompson v. North American Stainless Inc. and the opinion is here.
DGV

U.S. Supreme Court Upholds Background Check Questions

The U.S. Supreme Court ducked deciding whether the U.S. Constitution protects individuals' right to privacy in personal information.  Instead, they "assumed" that there was such a protection and then decided that NASA's background questions were constitutional no matter what.  This provoked a concurrence in the judgment only from Justice Scalia (and another, short one from Justice Thomas), as both of them wanted the court to decide the constitution contains no such right.

The employment law issue here is whether NASA's questions were appropriate issues to ask applicants and employees. Most federal government employees are subjected to a standard background check. But contract employees were only recently added, following the 9/11 attacks.  NASA employed a number of contract employees at its Jet Propulsion Lab, and had to implement the checks for current employees, some of whom were employed for many years.

The questions included standard background information, but then asked about drug use, sales, etc., and asked for explanations if the employee admitted to involvement with illegal drugs.  After the employee answered the questions, the agency sent out questionnaires to landlords and references on a standard form. That standard form contains a number of questions to which plaintiffs objected:

the form asks if the reference has "any reason to question" the employee’s "honesty or trustworthiness." Id., at 97. It also asks if the reference knows of any "adverse information" concerning the employ. If "yes" is checked for any of these categories, the form calls for an explanation in the space below. ... That space is also available for providing "additional information" ("derogatory" or "favorable") that may bear on "suitability for government employment or a security clearance." Ibid.

The Ninth Circuit held that the request for an explanation by the employee about drug treatment or counseling did not serve a legitimate interest sufficient to overcome the employee's privacy rights. The court of appeals also decided that the reference forms contained open ended questions that infringed on privacy rights without sufficient linkage to the job.

On review, the Supreme Court decided that these questions do not infringe upon privacy rights even if they were protected by the Constitution:

The questions challenged by respondents are part of a standard employment background check of thesort used by millions of private employers. See Brief for Consumer Data Indus. Assn. et al. as
*** [W]e conclude that the chal-lenged portions of both SF–85 and Form 42 consist of reasonable, employment-related inquiries that further the Government’s interests in managing its internal opera-tions. See Engquist, 553 U. S., at 598–599; Whalen, 429 U. S., at 597–598. As to SF–85, the only part of the formchallenged here is its request for information about “any treatment or counseling received” for illegal-drug use within the previous year. The “treatment or counseling”question, however, must be considered in context. It is a followup to SF–85’s inquiry into whether the employee has“used, possessed, supplied, or manufactured illegal drugs” during the past year. The Government has good reason toask employees about their recent illegal-drug use. Like any employer, the Government is entitled to have itsprojects staffed by reliable, law-abiding persons who will“‘efficiently and effectively’” discharge their duties. See Engquist, supra, at 598–599. Questions about illegal-drug use are a useful way of figuring out which persons havethese characteristics.Amici Curiae 2 (hereinafter CDIA Brief) ("[M]ore than 88% of U. S.companies . . . perform background checks on their employees"). The Government itself has been conducting employment investigations since the earliest days of the Republic.

The court's decision is important to private sector employers looking to justify personal questions and investigative consumer reports. The court recognized the legitimacy of these issues, including questions about drug use.  That should help private-sector and public employers with invasion of privacy claims related to drug testing and background investigations.

Of course the court did not deal with the issue of "adverse impact" discrimination claims here. But the defense to adverse impact is "job related and consistent with business necessity." Language in this opinion should help estasblish this defense.

The opinion is NASA v. Nelson and it is here.
 DGV

Ninth Circuit Pretty Much Kills Most Attorneys' Fees Awards to Employers

In a case where the court readily acknowledged that the plaintiff's claims were frivolous, the court invented a whole new standard for awarding attorney's fees.  The fees statute says the "prevailing party" is entitled to "reasonable attorney's fees."  Then the courts said that employers can recover fees only if the plaintiff's claims are frivolous. 

In this case, Harris v. Maricopa County Superior Court, the court of appeals decided if the plaintiff asserts multiple claims, the defendant can recover fees only on the amount of time spent exclusively on frivolous claims.  So, let's say  the defense counsel spends time that overlaps on frivolous and non-frivolous claims - the attorneys' fees cannot be recovered at all.

In essence, they might as well have said, "if there are multiple claims, unless they are all 100% frivolous, the defendant shouldn't even bother trying for attorney's fees."  Instead, the court hides its true intention by setting a new standard ensuring it's impossible to recover fees, without really saying so. Judge Stephen Reinhardt, who has never met a plaintiff he didn't like, laughed at employers like this:

Although the court may not have erred in determining that the claim was frivolous, it nonetheless erred in awarding substantial fees to defendants on this claim. Almost every time entry in defendants’ fee petition for work related to the hostile work environment claim was also listed as related to some or all of Harris’s nonfrivolous discrimination claims. As we have already explained, in a civil rights action with multiple claims, only some of which are groundless, a defendant is entitled only to those fees attributable exclusively to defending against plaintiff’s frivolous claims. If the work is performed in whole or in part in connection with defending against any of plaintiff’s claims for which fees may not be awarded, such work may not be included in calculating a fee award. Accordingly, the fees properly attributable to this claim, if any, would be quite minimal.

The court's rationale is that the law is "solicitous" of plaintiffs' complaints in civil rights cases.  The court more accurately is "solicitous" of bad faith lawsuits with no chance of succeeding.  It is not mutually exclusive to allow plaintiffs with bona fide claims to have a day in court, while still enforcing some minimal standards.  If a case is frivolous, that means it never should have been brought. It is only fair to defray some of the employers' costs in defending against a lawsuit that never should have been filed in the first place.

Oh, I'm not the only one who smacked his forehead after reading the opinion in this case. There was a dissent that pretty much calls bull on the majority.  Perhaps the full en banc court will take up this issue.

The opinion is Harris v. Maricopa County Superior Court and the opinion is here.

DGV

Court of Appeal: No Attorney-Client Privilege for Employee's Emails to Lawyer

Gina Holmes worked for Petrovich Development Co. LLC as assistant to the CEO, Paul Petrovich.  She was pregnant early in her employment and got into a discussion with her boss about the length of her leave and their respective feelings about her pregnancy. Although it appeared that they had cleared the air, Holmes simultaneously attempted to hire a lawyer, via email at work. Apparently, Holmes became upset that Petrovich forwarded her emails to others in the organization and quit, claiming constructive discharge, discrimination, harassment, etc.

The trial court summarily dismissed the harassment, discrimination and retaliation claims. The court of appeal affirmed - holding that the harassment evidence was limited to email correspondence that was neither severe nor pervasive.

The court of appeal also affirmed dismissal of the claim that Holmes was forced to resign. The court noted that when a plaintiff cannot establish a hostile work environment, a constructive discharge claim is a higher standard and must also fail.  Holmes' retaliation claim failed too, because of the lack of an adverse action.

That left claims for intentional infliction of emotional distress and invasion of privacy, which were tried to a jury. The jury found for the defendants. On appeal, Holmes claimed the trial court should not have allowed Petrovich to use the emails she sent to a lawyer seeking a referral, in which she explained her situation.  The trial court held that Holmes waived the privilege because she used company email, and there were clear policies explaining the company's right to monitor email.

The court of appeal agreed that Holmes waived the privilege Here is the money quote:

Although a communication between persons in an attorney-client relationship "does not lose its privileged character for the sole reason that it is communicated by electronic means or because persons involved in the delivery, facilitation, or storage of electronic communication may have access to the content of the communication" (§ 917, subd. (b)), this does not mean that an electronic communication is privileged (1) when the electronic means used belongs to the defendant; (2) the defendant has advised the plaintiff that communications using electronic means are not private, may be monitored, and may be used only for business purposes; and (3) the plaintiff is aware of and agrees to these conditions. A communication under these circumstances is not a “„confidential communication between client and lawyer‟” within the meaning of section 952 because it is not transmitted “by a means which, so far as the client is aware, discloses the information to no third persons other than those who are present to further the interest of the client in the consultation . . . .” (Ibid.)


When Holmes e-mailed her attorney, she did not use her home computer to which some unknown persons involved in the delivery, facilitation, or storage may have access. Had she done so, that would have been a privileged communication unless Holmes allowed others to have access to her e-mails and disclosed their content. Instead, she used defendants‟ computer, after being expressly advised this was a means that was not private and was accessible by Petrovich, the very person about whom Holmes contacted her lawyer and whom Holmes sued. This is akin to consulting her attorney in one of defendants‟ conference rooms, in a loud voice, with the door open, yet unreasonably expecting that the conversation overheard by Petrovich would be privileged.

Lawyers for employees obviously should take note and advise employees not to use monitored email systems. Employers should ensure their email policies are comprehensive and clear regarding employees' expectations of privacy.

The case is Holmes v. Petrovich Development Company LLC and the opinion is here.