Recovering Attorneys’ Fees as a California Whistleblower

In representing a public employee whistleblower who suffered retaliation and was terminated from her job, Bryan Schwartz Law won an important victory this week, with the Superior Court ruling that she will be eligible to recover attorneys’ fees if she wins at trial, under California Code of Civil Procedure §1021.5. The defendant employer (a county) had argued that the whistleblower under California Labor Code §1102.5 was not eligible for fee-shifting because the primary effect of the action (if successful) would be to vindicate plaintiff’s personal economic interests – that is, to help her get her job back, with back pay and emotional distress damages. However, the Court embraced the plaintiff’s argument that the county was applying the wrong equation.

Under §1021.5, there are three elements to a fee award: “(1) the enforcement of an important right affecting the public interest; (2) the conferring of a significant benefit on the general public or a large class of individuals; and (3) the necessity and financial burden of private enforcement renders the award appropriate.” (internal quotations omitted) Jaramillo v. County of Orange (2011) 200 Cal.App.4th 811, 829. Plaintiff argued – and the Court agreed – that protecting whistleblowers from retaliation is a strong public interest. Doing so confers a significant benefit on the general public – namely, empowering people to step forward to expose fraud, corruption, and other wrongdoing. See, e.g., Green v. Ralee Engineering Co. (1998) 19 Cal. 4th 66, 77.

As an example, in Jaramillo, 200 Cal.App.4th at 829, the plaintiff recovered attorneys’ fees under §1021.5, stemming in part from whistleblower a retaliation claim under §1102.5 of the California Labor Code. The Court of Appeal found a public benefit where the outcome would “inure to the benefit of the citizens and taxpayers of [the] County by lessening the probabilities of abuse and corruption in the sheriff's office [where the plaintiff worked]….[The case established that] any person occupying the office of the county sheriff will not be able to assume, as this record shows [the wrongdoer] did, that he or she may ignore warnings of wrongdoing (or even mere mismanagement) from high level sheriffs and then be able to cover up the fact of those warnings with an in-the-corner ‘at will’ termination.”

The principle is clear: litigation resulting in the vindication of whistleblowers who step forward to protect the public fisc does confer a significant benefit on the public, and may warrant fee-shifting. This is because fee-shifting for a prevailing whistleblower encourages others to blow the whistle and expose public corruption, without fear of reprisal, and puts public employers on notice that they cannot act with impunity against whistleblower employees.

Since a public employee whistleblower exposing corruption likely meets the public benefit prong, the question remains whether the necessity and financial burden of private enforcement renders a fee award appropriate. Under the recent California Supreme Court case of Conservatorship of Whitley (2010) 50 Cal. 4th 1206, a fee award is appropriate when there is a public benefit to the litigation, if the expected recovery (i.e., accounting for litigation risk) is not significantly greater than cost of litigation. In other words, in public interest litigation, if a plaintiff is 50% likely to recover $100,000, then the fees/costs incurred will have to be significantly less than $50,000 for the losing employer to avoid §1021.5 fee-shifting. See Whitley, 50 Cal.4th at 1215-1216 (citing with approval Los Angeles Police Protective League v. City of Los Angeles (1986) 188 Cal.App.3d 1).

The Whitley precedent is very important for whistleblowers – especially public employees – and their advocates, since public employees cannot recover punitive damages, and since their wage loss in middle-income positions typically does not reach the million-plus dollars that litigation through trial will cost: “[A] bounty will be appropriate except where the expected value of the litigant's own monetary award exceeds by a substantial margin the actual litigation costs.” Whitley, 50 Cal.4th at 1216.

Though the whistleblower protection law, Cal. Lab. §1102.5, does not have its own fee-shifting provision, like the Fair Employment and Housing Act does, under Cal. Code of Civ. Pro. §1021.5 a whistleblower can hope to recover attorneys’ fees if he/she is successful in litigation.


DISCLAIMER: This article is for general interest and nothing in this article is intended to form an attorney-client relationship or provide fact-specific guidance in anyone's case. To seek to obtain legal advice about your whistleblower case, contact Bryan Schwartz Law and request an initial consultation: www.bryanschwartzlaw.com

Trip Leaders for Fancy Teen Tours Should Be Paid the Minimum Wage

Bryan Schwartz Law and co-counsel, Rudy Exelrod Zieff & Lowe, issued the following press release this week:

Trip Leaders File Class Action for Unpaid Overtime

Violations Alleged on Behalf of Hundreds of Employees

San Francisco, California, February 21, 2012: A class action lawsuit filed on Friday accuses Adventures Rolling Cross-Country, Inc. (“ARCC”), and its owner, Scott Von Eschen, of Mill Valley, California, of failing to pay basic minimum wages to workers who work chaperoning kids on expensive trips abroad and domestically. The case was filed in Marin County Superior Court. The plaintiffs are Peter Wright and Michelle Trame, and the case is Peter Wright and Michelle Trame v. Adventures Rolling Cross-Country, Inc., et al, case number 1200767.

The lawsuit alleges that Trip Leaders undergo approximately 10 days “training” in Mill Valley, California, typically spending 10 hours per day working. Thereafter they depart for trips ranging from two weeks to 90 days. Plaintiffs, for example, each led a trip lasting 24 days. During the trips, in which they are essentially babysitting a large group of teens, they are on-call 24 hours a day – responsible for the safety of the kids. Trip Leaders actively work anywhere from 12-16 hours a day with little to no time at rest.

Plaintiffs estimate that they, and the class members, worked over 350 hours for ARCC, earning for all of this time only approximately $1,000 (in the case of Peter Wright) – less than $3.00/hour – and approximately $1,080 (in the case of Michelle Trame) – still well under $3.00/hour. These wages are far below state and federal minimum wages and overtime requirements, according to the lawsuit.

The proposed class includes hundreds of current or former Trip Leaders across the country.

“The fact that the for-profit company is providing a nice travel experience for kids is no excuse for exploiting the Trip Leaders.” said David A. Lowe, a partner at Rudy, Exelrod, Zieff & Lowe, LLP, who is representing the Trip Leaders with Bryan Schwartz, of Bryan Schwartz Law. “The Trip Leaders work long hours trying to keep the kids safe and on schedule, and they deserve to be compensated for their work,” according to Schwartz. “This may be a vacation for the kids – but it is anything but relaxing for the Trip Leaders,” he added.

Wright, 26, commented, “Parents ought to know that their children, entrusted to ARCC, which is paid a lot of money to watch them, are being looked-after by Trip Leaders making about a third of the minimum wage.”

The plaintiffs are seeking unpaid minimum and overtime wages and other compensation on behalf of current and former Trip Leaders throughout the country.

Plaintiffs' Attorneys:

Rudy Exelrod Zieff & Lowe is a leading law firm in the field of wage and hour class actions and won the largest overtime verdict in United States history in Bell v. Farmers Insurance Exchange. The firm specializes in representing employees in individual and class action litigation.

Bryan Schwartz Law is an Oakland, California-based law firm dedicated to helping employees protect their rights in the workplace. Bryan Schwartz Law has successfully litigated individual and class action complaints nationwide, helping to recover millions of dollars for thousands of employees, forcing corporations and Government agencies to change their practices and punish wrongdoers.


ARCC employees or former employees who would like to learn more about the case should visit www.rezlaw.com and click on “Class Actions” or contact David Lowe at (415) 394-6078, dal@rezlaw.com, or Bryan Schwartz at (510) 444-9300, bryan@bryanschwartzlaw.com.

Landmark Decision by National Labor Relations Board Gives Hope of Level Playing Field for All Workers

Last year, the U.S. Supreme Court ruled in AT&T Mobility v. Concepcion that the California Supreme Court’s Discover Bank rule – that arbitration agreements negating the ability to proceed collectively/as a class were presumably unconscionable, because of unequal bargaining power – was contrary to the Federal Arbitration Act (FAA), because it was discriminatory against arbitration. See my blog post of May 2011, discussing this decision:

http://bryanschwartzlaw.blogspot.com/2011_05_01_archive.html

Last week, the National Labor Relations Board (NLRB) took a bite out of Concepcion’s impact, when it held that arbitration agreements precluding joint, class, or collective actions violate Section 7 of the National Labor Relations Act, which protects the right to engage in concerted action for mutual aid or protection. See the NRRB’s landmark decision in D.R. Horton, Inc., and Michael Cuda, Case 12-CA-25764, here:

http://www.bryanschwartzlaw.com/horton.pdf

What does this mean for regular folks in the workplace? Simply put, it means that the playing field still has a chance at being level – at least until the Supreme Court gets a hold of the D.R. Horton decision.

If you have a wage/hour claim or some other kind of claim, and you are trying to pursue the claim with other employees/former employees – because there is power in numbers, when you are fighting an employer which has an unequal share of the bargaining power – then it is important to learn whether the employer required you to sign an arbitration agreement barring class or collective action when you were hired. Many employers do so require.

If the employer has a policy making its workers sign contracts prohibiting class/collective/joint action against it, or had such a rule within the last 180 days, then you can file an unfair labor practice charge (ULP) with the NLRB, employing the reasoning of D.R. Horton:

https://www.nlrb.gov/sites/default/files/documents/48/nlrbform501.pdf

Under D.R. Horton, you will still have a chance to make a greater impact than you could make as one employee against a big employer.

If you have questions about how to handle your claims that may be subject to an arbitration agreement and/or a ban on class/collective action, contact Bryan Schwartz Law today: bryan@bryanschwartzlaw.com


DISCLAIMER: Nothing in this posting, for general information only, is intended to create an attorney-client relationship. Bryan Schwartz Law does not represent you unless and until you have a signed representation agreement with the firm. You alone are responsible for any deadlines that concern your claims, until you hire an attorney to represent you.

Workplace Safety Violations Result in Serious Consequences for Employers

The tragic case of Margarita Mojica, a 26-year-old printing plant worker killed at work in 2008, should stand as a sobering reminder to employers that workplace safety should be given the highest priority. Though protecting employees' lives should be incentive enough, employers like Ms. Mojica's may be criminally liable under the California Labor Code as well as criminal statutes.

In Ms. Mojica's case, the owner and manager of the San Francisco-based Digital Pre-Press International now face criminal charges for her death that was caused by a power press machine that lacked proper mechanical and handling safeguards. Ms. Mojica's case is but one of the approximately 6,000 workplace deaths that happen annually in the United States.

In a preliminary hearing, Judge Newton Lam found that a jury could find the employers committed criminal negligence in Ms. Mojica's untimely death. The defendants could each face up to four years and eight months of incarceration, plus fines of up to $250,000. The corporation faces up to $1.5 million in fines.

The California Labor Code contains numerous sections that impose criminal liability for employer violations. Although employers may not be frequently prosecuted for violations of the Labor Code, this case should remind employers that these criminal violations can be extremely serious.

If you believe you are working in an unsafe workplace due to faulty equipment, exposure to chemicals, or other inadequate safety measures, call Bryan Schwartz Law for a free consultation today: 510-444-9300.

Bryan Schwartz Law Goes to Trial on Behalf of Whistleblower Against Government Corruption

Bryan Schwartz Law is in the midst of a month-long jury trial on behalf of our client, whistleblower Denise Winters, against her employer, the County of Solano - an exurban/rural County located between the San Francisco Bay Area and Sacramento.

The following lead story by Jess Sullivan was published today in the Daily Republic newspaper, in Solano County.

Trial under way for whistle-blower employee suing county

FAIRFIELD — A jury trial got under way this week for a Solano County employee who sued the county claiming she is the victim of retaliation and harassment for blowing the whistle on her boss’ massive amount of questionable paid overtime.

Denise Winters was an office assistant who was responsible for time sheets for her small group of coworkers including her supervisor within the county’s Department of Information Technology.

Winters was troubled that her supervisor, Sherrie Filbert, was racking up lots and lots of overtime during the 2007 and 2008 fiscal year.

Filbert had more than 1,100 hours of overtime and worked almost exclusively at her home on evenings and weekends. Filbert, a county employee of nearly 30 years, was racking up 20, 30 and sometimes 40 hours of overtime weekly, according to court records.

The overtime cost taxpayers more than $41,000.

Winters reported the overtime to the County Auditor Controller’s Office in 2008. Simona Padilla-Scholtens, the auditor-controller, looked at overtime and quickly turned the matter over to the District Attorney’s Office because of the possibility that criminal fraud had been committed. No charges were ever filed after the investigation.

Filbert was put on paid administrative leave for six months while county staff tried to figure out what she had done. Ultimately, Filbert was given a two-week suspension for dishonesty. Then she went back to her old job, which included supervising Winters.

Winters claims she then began to suffer harassment and retaliation in the workplace. Within a few months, Winters’ name was put on a layoff list and in spite of her seniority, she was laid off. She was the only person in her office who was laid off. But she landed another job with the county, with less pay, working in the First 5 program.

Winters sued the county in 2010.

During the first week of testimony, jurors learned that Filbert’s boss, Russ Hansen, and his boss, Ira Rosenthal, had signed off on the overtime week after week until Winters reported the dubious overtime to the Auditor Controller’s Office.

Rosenthal said in an email that the overtime had been appropriate to which another county department head responded saying “The Easter Bunny is real, too.”

Padilla-Scholtens testified that Hansen and Rosenthal had not been paying attention to the overtime Filbert had been running up. Hansen and Rosenthal also said the overtime was not approved in advance and that the overtime was mostly for a project that had no defined scope and with no defined time frame.

That same year the Auditor Controller’s Office checked on all the overtime being paid to more than 1,400 county employees. The bulk of that overtime went to law enforcement and jail guards, making Filbert stand out. Filbert had the second-highest amount of overtime among all county employees. Documents showing which county employee racked up even more overtime have been redacted.

Filbert’s overtime was for a project she took on at her own initiative. Filbert decided to try to reconcile and untangle very old accounts of receivable invoices for equipment managed by the technology department, much of it used by other county departments.

Filbert’s time sheets reflect that she worked every single day for three months, frequently from 7 a.m. to 11 p.m. Most weekends she worked 12 hours on both Saturday and Sunday. She did the work at home without a county computer and without a link to the county’s computer network, according to Winters’ attorney.

Eventually the Auditor Controller’s Office determined that the project Filbert undertook could have been done in 40 to 100 hours, not in the more than 1,100 hours. They took over the project and concluded it shortly after Filbert was put on administrative leave.

The attorney representing the county, Carolee Kilduff, said Filbert had taken on the enriching project for partly personal reasons. Kilduff said the that Filbert found the project was “fun.”

“It was her recreation,” Kilduff told jurors, likening the project to doing a jigsaw puzzle.

Kilduff concedes the oversight of Filbert by Hansen and Rosenthal was “lax” and that there “should have been better communication” about Filbert’s project with her bosses.

Kilduff told jurors that Rosenthal’s decision to lay off Winters had nothing to do her reporting Filbert’s overtime.

The trial is scheduled to resume Monday.

http://www.dailyrepublic.com/news/topstories/trial-under-way-for-whistle-blower-county-employee-suing-county/

Are You Accused of Having “Unclean Hands?”

The “unclean hands” defense and its evil twin sister, the “after-acquired evidence” doctrine, are used by many employers facing a lawsuit as an excuse to dredge up anything they can find on the employee suing them. Before filing a lawsuit against your employer or former employer, you need to anticipate that they will do this, and be prepared. If you have too many skeletons in your own closet, you may want to think twice about bringing a suit in the first place. This does not mean, however, that employers’ attempts to soil the employee suing them always succeed – in fact, there are many ways that these attempts fail, as a matter of law.

Basically, the “unclean hands” defense is based on an equitable principle that a defendant should not have to pay someone accusing the defendant of wrongdoing when the plaintiff himself or herself is just as guilty of the bad practice that is the subject of the suit. The “after-acquired evidence” doctrine gained strength after the United State Supreme Court’s decision in McKennon v. Nashville Banner Publishing Co. (1995) 513 U.S. 352, which has been applied to hold that for someone suing based on violation of an important statute, like the anti-discrimination laws, he or she cannot have the entire suit eliminated based upon “unclean hands” – because of the public policy promoted by the statute itself. In other words, a discriminator should not get off the hook just because the discrimination victim had some problems, too – because our society has determined that discrimination is wrong. However, if the employer or ex-employer finds viable “after-acquired evidence,” the relief that the discrimination victim himself or herself might receive can be limited in some cases – i.e., if the employer can show that the employee would have been terminated anyhow for something the employer has learned after the suit was filed (a common example is proven fraud in your employment application), then the employee may not have a right to get his/her job back, or get back pay after the date on which the after-acquired evidence was discovered.

Here are some arguments you should raise if you are confronted with the “unclean hands” defense or “after-acquired evidence" doctrine:

In California, under the Fair Employment and Housing Act (FEHA) and whistleblower protection laws in the Labor Code, the unclean hands doctrine is inapplicable, when the defense purports to relate to acts occurring in the course of the employment relationship. See Murillo v. Rite Stuff Foods, Inc. (1998) 65 Cal.App.4th 833, 848-851 (FEHA case in which neither the after-acquired-evidence rule nor the unclean hands doctrine was applicable to claimed sexual harassment damages, notwithstanding her misconduct in misrepresenting her citizenship status). In general, “equitable principles may not be applied in opposition to statutory enactments or to defeat public policy established by the Legislature.” Angelucci v. Century Supper Club (2007) 41 Cal.4th 160, 171 (citing 13 Witkin, Summary of Cal. Law (10th ed. 2005) Equity, § 3, p. 285; McKennon, 513 U.S. at 360–362.

As the United States Supreme Court noted in McKennon, “We have rejected the unclean hands defense ‘where a private suit serves important public purposes’” like the elimination of workplace discrimination. McKennon, 513 U.S. at 360-361. See also Mortgages, Inc. v. U.S. D. Ct. For D. of Nev. (9th Cir. 1991) 934 F.2d 209, 213 (district court erred when it denied a motion to dismiss the counterclaims based on bad faith by False Claims Act (FCA) relators, reasoning that “[t]he FCA did not intend to ameliorate the liability of wrongdoers by providing defendants with a remedy against a qui tam plaintiff with ‘unclean hands.’”);  Ramirez v. Greenpoint Mortg. Funding, Inc., 268 F.R.D. 627, 638 (N.D. Cal. 2010) (Henderson, J.) (rejecting unclean hands defense in discrimination case based on public policy favoring broad equitable relief).

California law concerning public policy statutes is consistent with the federal precedents: “Where an employer has fired a worker in violation of a statutory ban on discrimination in the workplace, the purpose and effect of the antidiscrimination statutes are unacceptably undermined by a principle that would allow a fact that played no part in the firing decision to bar any recovery.” Camp v. Jeffer, Mangels, Butler & Marmaro (1995) 35 Cal.App.4th 620, 633. “When a plaintiff alleges wrongful termination in violation of public policy, that cause of action, like one based on discrimination, serves sufficiently important public purposes to outweigh a claim of unclean hands.” Id. at 635-636; General Dynamics Corp. v. Superior Court (1994) 7 Cal.4th 1164, 1181 (“[T]he doctrinal foundation of the public policy tort claim is not so much the plaintiff's continued interest in employment as the preservation of the public interest.”); De Burgh v. De Burgh, 39 Cal. 2d 858 (1952) (noting that “equity does not deny relief on the ground of plaintiff’s unclean hands when to do so would be harmful to the public interest”).

The only exception to the prohibition on an unclean hands defense to a public policy-driven statutory claim is where an employee's subsequently discovered wrongdoing would have prevented employment by the defendant from the outset. See, e.g., Murillo, 65 Cal.App.4th at 845 (plaintiff misrepresented herself as a legal resident alien, and her misrepresentations about her immigration status “went to the heart of the employment relationship,” and so precluded reinstatement remedy); Camp, 35 Cal.App.4th at 636, 638-639 (plaintiffs were convicted felons; defendant was precluded by law from employing convicted felons). In Camp, misrepresentations by the employees jeopardized the defendant law firm’s contracts with a government agency and potentially subjected the firm to accusations that it had made false statements to the government. Id. at 636-637. Camp suggested that unclean hands defenses are inapplicable where the supposed violations by the plaintiff relate to “internal, self-imposed requirements for the job” or its “voluntarily adopted policy.” Id. See also Cooper v. Rykoff-Sexton, Inc. (1994) 24 Cal.App.4th 614, 618-619 (reversing a summary judgment for employer on “unclean hands” where there was resume fraud by an employment discrimination plaintiff, finding that automatic forfeiture of claims was “too harsh a penalty” in many cases of misconduct – holding, “Where an employer has fired a worker in violation of a statutory ban on discrimination in the workplace, the purpose and effect of the antidiscrimination statutes are unacceptably undermined by a principle that would allow a fact that played no part in the firing decision to bar any recovery.”).

In sum, public policy underlying FEHA, Cal. Lab. §1102.5, and other important statutory protections, may prevent application of the unclean hands defense in your case, unless the evidence the employer possesses meets the tough “would have prevented employment” or “heart of the employment relationship” standard.

It is also important to argue that misconduct triggering the unclean hands doctrine must relate directly to the transaction at issue. See Camp, 35 Cal.App.4th at 638-639; Farahani v. San Diego Community College Dist. (2009) 175 Cal.App.4th 1486, 1495 (defense “closes the doors of a court of equity to one tainted with inequitableness or bad faith relative to the matter in which he seeks relief”) (emph. added). See also Lane v. Micro-Focus (U.S.), Inc. (W.D.Wash. 2010) 2010 WL 5018146, at *11 (dismissing unclean hands defense where Defendants did not show any “willful misconduct that has an immediate and necessary relation to Plaintiff’s requested relief”).

If the supposed misconduct does not relate to any actions you took for personal gain, then unclean hands may not be applicable. See CrossTalk Productions, Inc. v. Jacobson (1998) 65 Cal.App.4th 631, 643 (finding that the allegedly “unclean” conduct of the plaintiffs differed from that of the defendant because the plaintiffs “had nothing to gain”). See, e.g., Dawe v. Corrections USA (E.D. Cal. 2010) 2010 WL 682321, at *26-27 (rejecting unclean hands defense where defendants did not meet initial burden of presenting evidence that plaintiffs’ actions were wrongful). Whistleblower statutes, in particular, tend to recognize that sometimes “wrongdoers might be rewarded” – but establish that such a cost is worthwhile to incentivize those knowledgeable about unlawful schemes to step forward. Recall, supra, Mortgages, 934 F.2d at 213 (discussing that the FCA was established to “set[] a rogue to catch a rogue”). If you were not complicit in the scheme you have helped expose, or if you feared retaliation in speaking out about it, then the unclean hands defense may not apply.

A defendant employer should also be precluded from advancing an “after-acquired evidence” defense unless the employer learns for the first time about employee wrongdoing that would have led to the discharge in any event. See Camp, 35 Cal.App.4th at 632. It is the employer’s burden to “establish that the wrongdoing was of such severity that the employee in fact would have been terminated on those grounds alone if the employer had known of it at the time of the discharge.” McKennon, 513 U.S. at 362-363. See also Brahmana v. Lembo, 2011 WL 1674993, at *9-11 (N.D.Cal. 2011) (rejecting equitable defense where employee failed to disclose criminal record or prior incarceration, even though employee handbook noted material omissions on employment application could result in termination); Cooper, 24 Cal.App.4th at 617-619 (facts of the case did not support a complete bar to relief, because the employee had a spotless and competent work record with the employer until he was terminated); Murillo, 65 Cal.App.4th at 845-84 (after-acquired-evidence rule would not have supported summary adjudication of wrongful termination claims, because triable issue existed as to whether employer would have terminated the employee had it known that she was an undocumented alien). Like in Murillo, id., where there was evidence that the employer had hired other undocumented aliens despite knowledge of their immigration status and fraudulent documents, your employer  cannot rely upon “after-acquired evidence” where it has acknowledged that it does not terminate other employees for such conduct as is alleged against you.

Perhaps most importantly, if you can show the employer knew of your supposed misconduct while you were employed, and did not terminate you, the “after-acquired evidence” defense is inapplicable. Whereas in Murillo, there was a triable after-acquired evidence issue, because nothing in the record indicated that the employer knew previously that the employee in question was ineligible to work (id., 65 Cal.App.4th at 845-84), in your case, the opposite may be true – the employer may not be in a position to claim recent discovery of any misconduct.

Finally, you may argue that the court should rule upon the defenses in equity – they are only a matter for the jury if they are “so intertwined with legal claims that [they] cannot be separately tried to the judge.” Unilogic, Inc. v. Burroughs, Corp. (1992) 10 Cal.App.4th 612, 623.

If you have questions about the applicability of the “unclean hands” defense or “after-acquired evidence” doctrine in your case, please contact Bryan Schwartz Law.

*Note: nothing in this article, intended to be of general interest, is intended to create an attorney-client relationship or constitute legal advice to you. Each case is different, and Bryan Schwartz Law does not represent you unless you have a signed representation agreement with the firm.

What is an "adverse action?"

If you are an employment discrimination victim or a whistleblower who suffered retaliation at the hands of your employer, to have an opportunity to recover you must show you suffered an “adverse action.” Some things that feel adverse to you are not necessarily “adverse actions” that will give rise to a case. On the other hand, an employer is wrong if it tells you that only a termination or a demotion is an “adverse action.”

If you were terminated, laid off, demoted, or in some other way lost pay as a result of the employer’s discriminatory or retaliatory action against you, then you suffered an adverse action. See, e.g., Guz v. Bechtel Nat'l Inc., 24 Cal.AppAth 317, 355 (“termination, demotion, or denial of an available job " is adverse action); Thomas v. Department of Corrections (2000) 77 Cal.App.4th 507, 511 (termination of employment and demotion are adverse actions); McRae v. Dep't of Corrections and Rehab. (2006) 142 Cal.AppAth 377, 393 (action that results in a reduction in pay satisfies requirement); Little v. Windermere Relocation, Inc. (9th Cir. 2002) 301 F.3d 958, 970 (pay cut is adverse employment action).

This is true even if the employer subsequently took some action to mitigate its damages. For example, in a case on which Bryan Schwartz Law recently defeated an employer’s summary judgment motion, the employer argued that, because our client was hired into another position after she was initially laid off, she did not suffer an adverse action. The employer’s argument failed. If you suffered a materially adverse consequence – even if it is relatively small, based on some type of mitigation – this should be sufficient to constitute an adverse action.

Likewise, if you are placed in a position with less advancement potential, fewer promotion opportunities, a less distinguished title, or suffered some other material loss of benefits or significantly diminished material responsibilities, you may have suffered an adverse action. See, e.g., Burlington Northern & Santa Fe Railway Co. v. White, 548 U.S. 53, 126 S.Ct. 2405, 2416 (2006)(reassignment to less desirable job responsibilities may be materially adverse action); Patten v. Grant Joint Union High School Dist. (2005) 134 Cal.App.4th 1378, 1389-1390 (lateral transfer without change in wages, benefits and duties may be an adverse employment action where the transfer is in reality a demotion, or there are significantly diminished material responsibilities); Akers v. County of San Diego (2002) 95 Cal. App. 4th 1441, 1456-1457 (diminished promotion opportunities is adverse action).

A hostile working environment can constitute an “adverse action.” It is also true, though, that “social slights” or “mere reduction in pleasantries” are not enough, usually, to constitute an adverse action, standing alone – though they may be important background evidence of discriminatory or retaliatory animus. On the other hand, both California and Federal courts will look at the totality of circumstances to determine whether the work environment or your job has been sufficiently for an adverse action to be established. See Yanowitz v. L 'Oreal USA, Inc.

(2005) 36 Ca1.4th 1028, 1055 ("no requirement that an employer's retaliatory acts constitute one swift blow, rather than a series of subtle, yet damaging, injuries”).

The Federal standard to prove that a retaliatory adverse action occurred is easier to meet than the California standard, as articulated in Yanowitz. In Federal courts, you may be able to prove an adverse action if you can show that the employer took any action against you which might tend to discourage a reasonable person from engaging in protected activity. See Ray v. Henderson, 217 F.3d 1234 (9th Cir. 2000). The Ray decision suggests that, if your former employer where you previously complained of discrimination or blew the whistle retaliates by giving a negative job reference to a different potential employer (even if you ultimately get the job you were seeking), this can be an adverse action, because it might tend to discourage people from speaking out against discrimination or other unlawful activities. Id. at 1242.

If you believe you may have been subjected to an adverse employment action based on discrimination or whistleblower retaliation, and want to speak to a lawyer, contact www.BryanSchwartzLaw.com today.