Tuesday, July 28, 2015
It Doesn’t Hurt to Ask: New CA Law Protects Right to Ask for Reasonable Accommodation Under California’s Anti-Discrimination Law
Tuesday, June 25, 2013
The Supreme Court Continues to Hinder Efforts to End Retaliation and Workplace Harassment: Univ. of Texas Southwestern Med. Center v. Nassar and Vance v. Ball State University
On June 23, 2013, a sharply divided Supreme Court issued two decisions that reveal the Court is out touch with the realities of the workplace and out of touch with the realities of workplace harassment and retaliation. The Court issued University of Texas Southwestern Medical Center v. Nassar, No. 12-484 (opinion, here) and Vance v. Ball State University, No. 11-556 (opinion here), two 5-4 pro-employer decisions authored by Justice Samuel Alito and Justice Anthony Kennedy, respectively. Justice Ginsburg authored two dissents that she read from the bench.
In the first case, Nassar, who is of Middle Eastern descent, alleged that the University of Texas Southwestern Medical Center blocked him from getting a new job. According to Dr. Nassar, the Medical Center denied him the new job after he complained that his supervisor discriminated against him based on his race and ethnicity. The U.S. Equal Employment Opportunity Commission found “credible, testimonial evidence” that the Medical Center retaliated against Dr. Nassar, and a jury found that the University violated the anti-retaliation provision of Title VII. Nassar, Slip Op., Dissent at p. 4. The U.S. Court of Appeals for the Fifth Circuit upheld the jury verdict.
Supreme Court overturned the decisions of the district and appellate courts, and the Equal Employment Opportunity Commission. Instead of applying the same standard of proof that is used for race and gender discrimination claims, the Court adopted a more stringent standard for retaliation, which Justice Ginsburg, in her dissenting opinion, recognized “lacks sensitivity to the realities of life at work.” Nassar, Slip Op., Dissent at p. 25. The lack of sensitivity to the realities of life at work is further reflected in Justice Kennedy’s words that convey empathy for the employer and disdain for employees: “The fair and responsible allocation of resources in the judicial and litigation system” requires raising the standard for retaliation claims because “[i]t would be inconsistent with the structure and operation of Title VII to so raise the costs, both financial and reputational, on an employer whose actions were not in fact the result of any discriminatory or retaliatory intent.” Nassar, Slip Op., at p. 19. Moreover, the majority’s lack of concern for the financial, reputational and emotional cost of retaliatory harassment to the employee in comparison to the Courts’ desire to reduce the number of retaliation claims filed, regardless of merit, is reflected in the acceptance of the following hypothetical considered by the Court: “Consider…the case of an employee who knows that he or she is about to be fired for poor performance, given a lower pay grade, or even just transferred to a different assignment or location. To forestall that lawful action, he or she might be tempted to make an unfounded charge of racial, sexual, or religious discrimination: then when the unrelated employment action comes, the employee could allege that this is retaliation.” Nassar, Slip Op., at p. 18.
For race and gender discrimination, the Court ruled that Title VII requires an employee to show only that race or gender was one of multiple “motivating” reasons for the employer’s decision-making. Nassar, Slip Op., at p. 23. However, for a claim of retaliation, the Court ruled that the employee must show that the employer would not have made the decision “but for” its improper retaliatory motive. Id. The Court remanded the case to the trial court to apply this higher standard to Dr. Nassar’s retaliation claim.
Unfortunately, the Court’s decision to raise the burden of proof for retaliation claims is in contrast to the strong safeguards necessary to shield employees who protest discriminatory actions. These protections particularly are important since the number of Equal Employment Opportunity Commission complaints has nearly doubled in the past 15 years from over 16,000 in 1997 to 31,000 in 2012. Nassar, Slip Op., at p. 18.
In Vance v. Ball State the Court ruled that in Title VII cases a person must be able to take “tangible employment actions against the victim, such as hiring and firing someone to be considered a supervisor in discrimination lawsuits, thereby making it harder to blame a business for a co-worker's unlawful and discriminatory behavior. Vance, Slip Op., at p. 30. Maetta Vance, the only African-American employee in the Ball State University kitchen, was exposed to racial slurs from Saundra Davis, the kitchen staff worker who gave Ms. Vance her daily work assignments.
The Court previously held that an employer is accountable under Title VII when one of its supervisors harasses an employee. In Vance, the Court ruled that Ball State was not responsible for Davis’s discriminatory conduct because Davis did not fit the Court’s narrow definition of “supervisor.” Vance, Slip Op., at p. 30. The Court’s ruling also rejected EEOC’s guidance regarding who is a supervisor. Vance, Slip Op. at pp. 20-21. The Court determined that because Davis did not have the power to make certain formal employment decisions, such as hiring, firing, or promoting, she was not a “supervisor” under Title VII, despite the fact that she controlled and supervised Ms. Vance’s day-to-day activities. Vance, Slip Op. at pp. 29-30.
Unfortunately, the Vance decision will leave employees without judicial recourse when faced with harassment by supervisors who may not have the ability to fire workers, but do have the ability to harass them in the workplace.
Both decisions show that the Court is out of touch with the realities of today’s workplace. In the real world, a coworker who assigns work, even without hiring and firing responsibility, can use that authority to make the conditions of another employees’ life miserable or unsafe because of a protected category. When there is unlawful behavior in the work place, the law should protect employees who try to make the workplace safe for everyone by reporting the situation. When there is unlawful behavior in the work place, the employer should be required either to fix the situation or be held accountable for not doing so. This is not just the reality of the workplace but this is common sense because everyone-regardless of race, gender or other-wants to work in a workplace free from harassment. Instead of ensuring justice and equality to all, the Court continues to listen to one singular voice-business. As Justice Ginsburg noted in her dissent, “[t]he ball is once again in Congress’ court to correct the error into which this Court has fallen, and to restore the robust protections against workplace harassment the Court weakens today.”
Tuesday, April 19, 2022
New life for whistleblower-retaliation claims
[This article by Bryan Schwartz and Cassidy Clark appeared first in the April 2022 edition of Plaintiff magazine.]
Lawson and not McDonnell Douglas now provides the framework for litigating section 1102.5 whistleblower claims
California continues to affirm its commitment to employees who blow the whistle on their employers’ unlawful practices. Plaintiffs’ lawyers should take note. Favorable recent developments in California whistleblower retaliation law mean we should all be looking for potential Labor Code section 1102.5 and other whistleblower retaliation claims.
The California Supreme Court, in Lawson v. PPG Architectural Finishes, Inc. (2022) 12 Cal.5th 703, explained that the evidentiary standard to establish liability in whistleblower cases is different, and lower, than the McDonnell Douglas burden-shifting framework typically utilized in discrimination cases. Under McDonnell Douglas, the ultimate burden is on the employee – but not so, for whistleblowers.
Whistleblowing employees force a heavy burden onto their employers after demonstrating that protected activity was a contributing factor in an adverse action. Paired with the legislature’s clarification that attorneys’ fees are available in whistleblower cases, codified in Labor Code section 1102.5, subdivision (j), Lawson reaffirms the state’s public policy interest in encouraging workplace whistleblowers to report unlawful acts without fearing retaliation.
Now, whistleblowers are stepping forward like never before, with a new awareness of health and safety in the wake of COVID, and social media increasingly available as a forum for raising concerns. Daily, whistleblowers impact global events, both with the war abroad, and at home, including at some of the biggest employers, from tech giants like Facebook to the federal government.
As plaintiffs’ lawyers, we are in the auspicious position to support whistleblowers and protect the public from employers’ harmful violations of the laws meant to protect us all.
California’s evolving statutory whistleblower protections
Many statutes protect California whistleblowers. For example, employees are specifically protected from retaliation for asserting their rights under FEHA (Gov. Code, § 12940, et seq.), filing a wage claim with the Labor Commissioner (Lab. Code, § 98.6), discussing working conditions (Lab. Code, § 232.5), complaining about workplace health and safety issues (Lab. Code, § 6310), using sick leave (Lab. Code, § 246.5), taking time off work for jury duty (Lab. Code, § 230, subd. (a)), among many other additional protected activities.
However, the most sweeping California whistleblower protection is Labor Code section 1102.5, enacted in 1984, which prohibits an employer from retaliating against an employee for disclosing information the employee reasonably believes violates the law. The protected disclosure may be to a government agency, a person with authority over the employee, or another employee who has authority to investigate or correct the violation. Under section 1102.5, an employee is also protected for refusing to participate in an unlawful practice. (Section 1102.5, subds. (b-c).) In California, “our Legislature believes that fundamental public policies embodied in regulations are sufficiently important to justify encouraging employees to challenge employers who ignore those policies.” (Green v. Ralee Engineering Co. (1998) 19 Cal.4th 66, 77.)
In 2003, in response to “a series of high-profile corporate scandals and reports of illicit coverups,” the legislature passed amendments to expand the Labor Code’s whistleblower protections. (Lawson, 12 Cal.5th at 710 (citing Assem. Com. on Judiciary, Analysis of Sen. Bill No. 777 (2003-2004 Reg. Sess.)).) These amendments included the addition of a procedural provision, section 1102.6. This section requires only that an employee show protected activity was a “contributing factor” under section 1102.5, by a preponderance of the evidence, before an employer must prove by clear and convincing evidence that the alleged action would have occurred for legitimate, independent reasons, apart from protected activities. With the addition of section 1102.6, the McDonnell Douglas burden-shifting framework was abandoned in whistleblower retaliation cases, according to Lawson. (12 Cal.5th at 709-710.)
What changed with Lawson?
After section 1102.6 became law, some California courts adopted it as a new evidentiary standard for whistleblower retaliation claims. (Lawson, 12 Cal.5th at 711.) But some courts continued to use the McDonnell Douglas standard, giving short shrift to section 1102.6. (Ibid.) Courts applying McDonnell Douglas to section 1102.5 adapted it to the whistleblower retaliation framework as follows:
First, a plaintiff was required to establish a prima facie case of retaliation by showing that she engaged in a protected activity, that she was subjected to an adverse employment action, and that there was a causal link between the two. (Morgan v. Regents of University of California (2000) 88 Cal.App.4th 52, 69). Second, the burden shifted to the employer to put forth evidence of a legitimate, nonretaliatory reason for the adverse employment action. (Id. at 68.) And third, the burden shifted back to the employee to prove the reason was pretext for impermissible retaliation. (Id. at 68-69; see also Lawson, 12 Cal.5th at 710.) The Lawson plaintiff ’s case was dismissed by the U.S. District Court on summary judgment, ostensibly because he failed to prove pretext, under this third element. He appealed.
On appeal, in 2020, the Ninth Circuit noted that California appellate courts conflicted on which evidentiary standard to apply, the McDonnell Douglas framework or that outlined in 1102.6, and certified a question to the California Supreme Court to clarify this issue (Lawson v. PPG Architectural Finishes (9th Cir. 2020) 982 F.3d 752.)
Lawson clarifies that section 1102.6, and not McDonnell Douglas, “supplies the applicable framework for litigating and adjudicating section 1102.5 whistleblower claims.” (12 Cal.5th at 712.) Lawson expressly disapproves state court cases relying on McDonnell Douglas-type burden shifting, including Hager v. County of Los Angeles (2014) 228 Cal.App.4th 1538, Mokler v. County of Orange (2007) 157 Cal.App.4th 121, and Patten v. Grant Joint Union High School Dist. (2005) 134 Cal.App.4th 1378.
How Lawson’s reading of section 1102.6 helps plaintiffs
Once an employee shows that the whistleblowing was a “contributing factor” to an adverse employment action, the burden shifts to the employer to demonstrate by clear and convincing evidence” that the alleged adverse employment action would have occurred “for legitimate, independent reasons” even if the employee had not engaged in protected whistleblowing activities. (Lawson, 12 Cal.5th at 712.) This means that the ultimate burden of proof under section 1102.6 lies with the employer to prove, convincingly, that the adverse action would have occurred without the whistleblowing activity.
The ultimate burden of proof in discrimination cases under McDonnell Douglas, to show pretext, is a heavy lift for many plaintiffs – as it was for the plaintiff in Lawson at the trial court. The Supreme Court in Lawson explains that even if the employer has a “genuine, nonretaliatory reason for its adverse action,” all a plaintiff has to do is show that the employer “also had at least one retaliatory reason that was a contributing factor in the action.” (Lawson, 12 Cal.5th at 715-16.) This recognizes the reality that unlawful whistleblower retaliation is often one of multiple reasons that employers can identify for their adverse actions.
The 1102.6 evidentiary standard is not focused on finding the one, “true” reason for the adverse action, as is the McDonnell Douglas framework. (Id. at 714.) Section 1102.6 recognizes the complexity of “mixed motive” cases, wherein employers may make decisions on the basis of both lawful and unlawful considerations. (Ibid.) Lawson says that section 1102.6 does not merely codify the “same-decision defense” under Harris v. City of Santa Monica (2013) 56 Cal.4th 203 in a whistleblower case – section 1102.6 provides the entire applicable framework for litigating and adjudicating section 1102.5 claims. (Lawson, 12 Cal.5th at 712.)
Some courts that referenced the section 1102.6 framework prior to Lawson applied a prima facie test akin to that from McDonnell Douglas as just the first step of their analysis. (See, e.g., Greer v. Lockheed Martin Corp. (N.D. Cal. 2012) 855 F.Supp.2d 979, 988.) Greer equates the first step of the section 1102.6 framework (a plaintiff must demonstrate, by a preponderance of the evidence, that the employee’s whistleblowing was a contributing factor to an adverse employment action) with the McDonnell Douglas framework: (1) the plaintiff engaged in a protected activity; (2) the plaintiff was subjected to an adverse employment action; and (3) there is a causal link between the two. (Greer, 855 F.Supp.2d at 988.) The Supreme Court in Lawson described Greer as one of the decisions in federal courts that showed “widespread confusion” about the evidentiary standards. Lawson brings clarity, holding that section 1102.6 allows plaintiffs to establish liability under section 1102.5 without reliance on McDonnell Douglas. (Lawson, 12 Cal.5th at 717.)
Assessing potential section 1102.5 claims
When assessing a potential 1102.5 claim, we should be prepared to address some of the considerations unaltered by Lawson. We should always investigate: whether the employee’s belief that an activity was unlawful was reasonable; whether the employee disclosed the unlawful activity externally to a government entity, or internally to someone with authority over the employee or the power to investigate or rectify the violation; and, whether an adverse action occurred after the disclosure, setting up an allegation that the disclosure was a contributing factor in what occurred.
Recall that section 1102.5 protects not just those who report violations of law, but also employees who are perceived by employers to have engaged in whistleblowing activity even if they did not do so (subsection 1102.5(b)), employees who testify before a public body about a practice they reasonably believe is unlawful (subsection 1102.5(a)), employees who refuse to participate in activities they reasonably believe are unlawful (subsection 1102.5(c)), and family members of individuals who engage in activities protected by the statute (subsection 1102.5(h)).
The one-two punch of sections 1102.5 and 1102.6 is intended to encourage employees to come forward about the legal violations of their employers without fear of retaliation. We can deploy these statutes not only to protect employees, but to help rectify the many underlying concerns that whistleblowers are raising.
Section 1102.5 fees
Beyond Lawson, the relatively recent addition of subsection 1102.5(j) makes clear that courts should award reasonable attorneys’ fees to a plaintiff who brings a successful action for whistleblower retaliation under section 1102.5, but not to a defendant who defeats whistleblower claims. Previously, if plaintiffs’ attorneys wanted to seek fees for whistleblowers, they had to do so under the California Labor Code Private Attorneys’ General Act (PAGA), or another statute.
Conclusion
Given the explosion of whistleblowing activity, coupled with new pro-whistleblower developments in California, plaintiffs and their lawyers are in a better position than ever to pursue whistleblower retaliation claims.
Tuesday, February 18, 2020
Blowing the Whistle—When Can You Go to Court about Retaliation?
California’s whistleblower
protection laws are some of the nation’s most expansive. A central component of
California’s whistleblower protection scheme is Section 1102.5 of the
California Labor Code,
which, among other protections, prevents employers from retaliating against
employees who make complain internally, make whistleblowing reports to
government agencies, or participate in government investigations. Section
1102.5 aims to encourage employees to speak out against wrongdoing. The 2003 amendments
also codified the California appellate court decision in Gardenhire v. City of Los
Angeles Housing Authority (2000) 85 Cal.App.4th 236, to clarify that a government employee’s
report to the agency where they work constitutes whistleblowing activity. Tuesday, March 4, 2014
Supreme Court Decision Extends Protections Against Whistleblower Retaliation to Employees of Private Companies Providing Services to Public Companies
The Court granted certiorari to address the specific question of whistleblower protections in SOX applied to employees of privately-held companies working as contractors and subcontractors for public companies. SOX was enacted to safeguard investors in public companies and restore trust in financial markets. The specific provision of the Act, § 1514A, states that “no [public] company…, or any officer, employee, contractor, subcontractor, or agent of such company, may discharge, demote, suspend, threaten, harass, or in any other manner discriminate against an employee in the terms and conditions of employment because of [whistleblowing or other protected activity].” The case arose on the heels of Senate reports and investigations of the Enron scandal showing widespread retaliation against investment bankers, brokers, and accounting firm professionals who raised concerns of potential securities fraud. As the Court explained, "The Sarbanes-Oxley Act contains numerous provisions aimed at controlling the conduct of accountants, auditors, and lawyers who work with public companies. [Citations] Given Congress’ concern about contractor conduct of the kind that contributed to Enron’s collapse, we regard with suspicion construction of §1514A to protect whistleblowers only when they are employed by a public company, and not when they work for the public company’s contractor." Slip Op. at 3.
Plaintiffs, Julie Lawson and Jonathan Zang, are former employees of different FMR, LLC, subsidiaries. FMR is a private company that contracts to advise and manage the Fidelity family of mutual funds. While the mutual funds are public companies, as is common in the mutual fund industry, the funds have no employees themselves who would otherwise act as gatekeepers to detect or deter fraud. Lawson alleged that she suffered adverse actions culminating in constructive discharge as a result of raising concerns that her employer overstated expenses associated with operating mutual funds. Zang also alleged that his employment was terminated after reporting inaccuracies concerning certain funds managed by the company in a statement intended for the SEC.
The Supreme Court decision today reverses the First Circuit Court of Appeals’ split decision holding that the term "employee" in § 1514A whistleblower protections refers only to employees of public companies and does not cover a contractor’s own employees. The decision paves the way not only to prevent future fraud on investors in public companies, but also provide meaningful remedies to whistleblowers subjected to retaliatory measures by their employers - whether such are publicly-held companies or not.
Employees of privately-held contractors and subcontractors exposing securities fraud in public companies may now seek remedies such as reinstatement or backpay for retaliation resulting from protected whistleblower activity. If you have experienced retaliation as a result of whistleblowing activity at your employer that contracts or subcontracts for a public company, contact Adetunji Olude.
Monday, July 24, 2017
Ninth Circuit Protects Immigrant Workers
Thursday, May 14, 2020
Whistleblowers—Public Heroes in an Uncertain Time for Workplace Safety
Perhaps the most famous heroic
COVID-19 whistleblower is China’s
Li Wenliang, a doctor who sounded the alarm about the
seriousness of the virus in its early days only to be sanctioned by the Chinese
government and later die of the illness. Beyond Dr. Bright, the United States has seen its fair
share of whistleblowing as well,
especially concerning unsafe working conditions. Holding employers accountable
for workplace safety is paramount during the pandemic, given that the
workplace is one of the places where the virus is most likely to spread. Whistleblowing
employees are necessary to bring employer safety inadequacies to light. Employees at workplaces like these are understandably concerned about workplace safety. Consequently, thousands of employees have courageously filed workplace safety complaints against their employers related to the coronavirus. These complaints have involved poor safety practices such as failing to provide personal protective equipment like gloves, masks, disinfectant, and cleaning supplies; failing to follow or implement social distancing requirements; forcing employees to work alongside sick co-workers; and requiring employees to report to work on-site in non-essential sectors. Recently, the CDC revised its guidelines to allow asymptomatic workers to continue working, which may lead to further workplace safety issues as asymptomatic carriers infect their coworkers.
Now, more than ever, we need heroes willing to step forward. One of the only good bits of news in this pandemic has been that heroes are emerging like never before to protect their colleagues, themselves, and their families.
Wednesday, October 23, 2019
Attorney’s Fees Awarded When Whistleblower Acted in the Public Interest
Friday, August 30, 2013
California Courts Split on Exhausting Whistleblower Claims Under Labor Code
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Better
to exhaust than be sorry.
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