Tuesday, August 29, 2017

California Appellate Court Rules that Victims of Outrageous Workplace Discrimination May Sue Supervisors for Intentional Infliction of Emotional Distress

Earlier this month, a the Fourth District Court of Appeals in San Diego ruled that an employee’s claim against a former supervisor for intentional infliction of emotional distress (“IIED”) in connection with discriminatory conduct could proceed and was not barred by the workers’ compensation exclusivity rule. [Link to opinion in Light v. California Department of Parks &Recreation.] The employee Melony Light, a park aide and office assistant for the California Department of Parks and Recreation, alleges that she was subjected to discriminatory treatment by her supervisor Leda Seals, after Light refused to participate in and defend Seals’ ongoing harassment of a co-worker, Delane Hurley, whom Seals believed to be a lesbian. Among other acts (as alleged by Light), Seals subjected Light to ongoing verbal abuse, demanded that Light lie to Human Rights Office investigators about Seals’ treatment of Hurley, and physically intimidated Light. Eventually, the Department eliminated Light’s working hours, in keeping with one of Seals’ threats to Light.

Light sought and received a worker’s compensation award worth nearly $13,000 for anxiety, nausea, loss of appetite, migraines, asthma attacks, body aches and pains, digestive problems, vomiting, severe abdominal cramps, and tightness in the chest. Under the worker’s compensation exclusivity rule, the worker’s compensation system is generally the exclusive remedy for workers injured on the job, whether the injury is physical or psychological. The policy behind the rule is the  “compensation bargain,” under which the employer assumes no-fault liability for workplace injuries, granting the employee relatively swift and certain compensation, but limiting the range of tort remedies available.

But the exclusivity rule is not absolute and, relevant here, a line of cases developed which established that employees may sue employers for IIED where the actionable conduct also violates the California Fair Employment and Housing Act (“FEHA”). These cases established that discriminatory acts fall outside the normal risks inherent to the employment relationship, and thus do not fall within the worker’s compensation bargain. See, e.g., Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 288 (“A claim for distress arising out of employment is not barred where the distress is engendered by an employer’s illegal discrimination practices.”). This FEHA exception recognizes that discrimination in the workplace is an exceptional injury, for which the worker’s compensation system alone cannot make an employee whole.

However, the viability of the FEHA exception to the exclusivity rule was placed in doubt by another recent ruling of the Fourth District in Yau v. Santa Margarita Ford., Inc. (2014) 229 Cal.App.4th 144, which concluded – without mention of FEHA – that the only viable exception to the exclusivity rule is for workplace injuries incident to a claim for wrongful termination in violation of public policy (also known as Tameny claims). The Yau court took the position that the California Supreme Court had severely limited the ability of employees to bring intentional infliction of emotional distress claims in Miklosy v. Regents (2008) 44 Cal.4th 876 , but the Court in Light concluded that its sister appellate panel had misread Miklosy, which involved an intentional infliction of emotional distress claim in the context of whistleblower retaliation and did not discuss FEHA.

 The opinion, authored by Justice Judith McConnell, also rejected the notion that an employee cannot bring an IIED claim against a supervisor, because FEHA does not permit claims against supervisors, finding that an IIED claim is not merely a different rubric to recover for a FEHA (or other workplace violation), but “is a substantively different claim, aimed at a different wrong, and protects a different interest.” In that regard, an IIED claim entails: (1) extreme and outrageous conduct by the defendant, with the intention of causing, or reckless disregard of the probability of causing, emotional distress; (2) the plaintiff’s suffering severe or extreme emotional distress; and (3) actual and proximate causation. IIED claims thus impose a high bar – and although not all FEHA cases will involve extreme and outrageous conduct by an individual supervisor or manager, many cases will.

The opinion further took aim at the trial court’s conclusion that Light had failed to raise triable issues of material fact as to any adverse employment action sufficient to support a claim for retaliation under FEHA at the summary judgment stage. Justice McConnell noted that Seals had explicitly threatened Light, telling her that she would be moved to a different workplace or terminated if she did not lie to the Human Rights Office. Then, when Light failed to follow orders, her scheduled hours were eliminated. Moreover, Light had been denied training and passed over for promotions. The Fourth District thus concluded that the trial court had erred and that Light’s FEHA retaliation claim could proceed.

In sum, while Light did not introduce the FEHA exception to the worker’s compensation exclusivity rule, the holding establishes its continued viability after Miklosy and Yau. Moreover, because Miklosy and Yau did not involve FEHA claims, Light does not create a direct conflict with those prior cases, making it unnecessary for the Supreme Court to resolve the tension between these lines of cases. Light provides clear encouragement to employees and their advocates to pursue IIED claims against individual managers and supervisors for discriminatory and outrageous conduct, in addition to FEHA claims against the employer. It also sends a clear message to employers that discrimination is not a “normal” part of the employment relationship, even if it is all too common, and that the risk to employers, managers, and supervisors of failing to prevent or take action against discriminatory conduct are substantial.