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Exceptions to the At-Will Presumption of Employment Public Policy Violations in California
Basic contract principles govern employment relationships in California. California Labor Code §2750 provides that a “contract of employment is a contract by which one, who is called the employer, engages another, who is called the employee, to do something for the benefit of the employer or a third person.”
Presumption of At-Will Employment
An employment relationship in California is also governed by a statutory presumption called “at-will” employment. Thus, an employment, having no specified term, may be terminated at the will of either party on notice to the other. Employment for a specified term means an employment for a period greater than one month. Having no specified term, the employment is terminable at the will of either party, even if the employee’s salary is negotiated annually. California Labor Code §2922.
Exceptions to At-Will Employment
The at-will presumption may be defeated by proving a written, express, implied or implied in fact contract of employment. To defeat a contract claim, an employer may argue that the employee either signed an application of employment containing at-will language and/or that the employer’s employee handbook contains at will language. However, an at-will provision in an application for employment does not preclude claims of an implied-in-fact contract to discharge only for cause because “an application for employment is not a contract; it is a mere solicitation of an offer of employment . . . As such the application cannot constitute an agreement, let alone a partially integrated agreement.”1
At Will Provisions in Handbooks or Manuals:
At-will provisions in employer handbooks in manuals are not conclusive and do not preclude proof of an implied in fact contract to discharge only for cause . . . “particularly where other provisions in the employer’s personnel documents themselves suggest limits on the employer’s termination rights.”2 Handbook disclaimers “should not permit an employer, at its whim, to repudiate promises it has otherwise made in its own self-interest and on which it intended an employee to rely.” 3 Even if a handbook states that the employment is “at will,” a contract not to discharge without cause may be implied from other provisions in the employer’s personnel policies and handbooks.4 For example, an at-will clause in an employee handbook did not preclude an implied-in-fact contract where the handbook also contained provisions that arguably might limit or modify the at-will language (a probationary period and an extensive set of work rules, violation of which would result in disciplinary action or discharge).5
Limits To An Employer’s Right to Discharge:
It is illegal for an employer to discharge an at-will employee for a reason that violates fundamental public policy. This exception is enforced through a tort law by permitting the discharged employee to assert against the employer a cause of action for wrongful discharge in violation of fundamental public policy. Several of California’s public policies are set forth below:
Complaining about workplace safety:
Labor Code §6310; Labor Code §6311 – forbids termination or layoff of an employee who refuses to work in conditions which violate the provisions of Cal/OSHA.
“Whistle blowing”
(disclosing employer’s illegal acts to governmental authorities) or filing or assisting a false claims action against the employer Government Code §12653(b); Labor Code §1102.5(b).
Conduct Protected Under The Labor Code
except conduct in direct conflict with the employer’s “essential enterprise-related interests” that would “actually constitute a material and substantial disruption of the employers operations.” Labor Code §98.6(c)(2)(A).
Political affiliation:
Labor Code §§1101, 1102.
Disclosing Amount of Wages:
Labor Code §232 provides that an employer may not forbid an employee from disclosing the amount of his or her wages, nor require an employee to sign a writing that purports to forbid such disclosure.6 Further, an employer may not discharge, discipline, or otherwise discriminate against an employee who discloses the amount of his or her compensation.7
Filing a complaint with the Labor Commissioner:
Labor Code §98.6.
Filing or planning to file a workers’ compensation claim, testifying in another employee’s proceedings, receiving rating award or settlement.
Labor Code §132a
Lawful Conduct during nonworking hours away from the employer’s premises.
Labor Code §96(k).
Proceedings Before Labor Commission:
Filing a claim or testifying in proceedings before the Labor Commissioner. Labor Code §98.6.
Suing Employer to collect civil penalties pursuant to the “Labor Code Private Attorneys General Act.”
Labor Code §2699 et seq.; Labor Code §98.6(a).
Refusing to Participate in Illegal Activity:
Refusing to participate in any activity that would result in a violation of state or federal law, rule or regulation. Labor Code §1102.5(c).
Family Care/Medical Leave:
Taking time off for family care or medical leave. California Family Rights Act (Government Code §12945.2(l)).
Appearing in Court for jury service, to appear in court as a witness, or to seek relief from domestic violence or sexual assault.
Labor Code §§230(a)-(c) & 230.1.
Judicial Proceedings:
To attend judicial proceedings relating to a crime in which the victim was the employee, an immediate family member or similar relation. Labor Code §230.2.
Attendance at Child’s School:
To appear at a child’s school when requested by a teacher when the employee’s child has been suspended (Labor Code §230.7, Education Code §48900.1); to appear, for a reasonable number of hours, to participate in school activities of a child in kindergarten or grades 1-12. Labor Code §230.8.
Emergency Duty:
To perform emergency duty as a volunteer firefighter or reserve police officer or emergency rescue personnel. Labor Code §230.3.
Military Duty:
To Attend Military Duty or Training. Mil. & Vets Code §394.
Working Conditions:
Labor Code §232.5 prevents an employer from conditioning employment upon an agreement that an employee refrain from disclosing information about the employer’s working conditions. The employer may not require an employee to sign a waiver or other document purporting to deny the employee the right to disclose information about the employer’s working conditions.8
Garnishments:
Threat of wage garnishments/garnishment of wages for payment of one judgment. Labor Code §2929(b).
Advocating Health Care:
A physician-employee’s advocating medically appropriate health care for patient. Business & Professions Code Code §2056(c).
Record of Arrest:
Record of arrest or detention not resulting in conviction. Labor Code §432.7(a); Labor Code §432.7(a) makes it unlawful for any employer to obtain or seek from any source or to use either information concerning an arrest or detention that did not result in conviction, or information about participation in a pretrial or post trial diversion program.9 It also prohibits the employer from using such information as a factor in determining any condition of employment, including, among other things, termination.10
Reporting of Improper Governmental Activities:
Government Code §8547 imposes liability for damages and criminal penalties on any person who retaliates against or threatens a state employee or applicant for state employment who discloses improper governmental activities.
Voice Stress Analysis:
Penal Code §637.3 prohibits the use of any system that examines or records in any manner voice prints or other voice stress patterns of another person to determine the truth or falsity of statements made by that person without his or her express written consent given in advance of the examination or recordation.11 Although Penal Code §637.3 does not expressly prohibit termination based on the results of, or the refusal to submit to, a voice stress test, it arguably embodies a public policy against nonconsensual testing that could form the basis of a common law wrongful termination action.
Refusal to Patronize Employer:
Labor Code §450 provides that an employer may not force an employee or a job applicant to patronize the employer or any other person in connection with the purchase of any thing of value.12 While a violation of Labor Code §450 is a misdemeanor,13 there are no reported cases for violations of this statute.
Medical Information Disclosure:
Civil Code §§56.10(a) et seq. provide that health care providers and employers must obtain a written authorization to disclose medical information about an individual, except in certain limited circumstances.14 Civil Code §56.20(b) provides that an employer may not discriminate against an employee for refusing to sign an authorization. And, if an employee signs an authorization, the employer must provide the employee with a copy of the document.15
Labor Organization Affiliation, Association and Organizing:
Labor Code §921 sets forth the public policy against any employment agreement that includes a promise by either party to join or not join, or remain or not remain a member of, a labor or employer organization. Labor Code §923 grants every worker “full freedom of association, self-organization, and designation of representatives of his own choosing, to negotiate the terms and conditions of his employment.”
Elections Officer:
Elections Code §12312 prohibits the suspension or termination of an employee because of absence from work while serving as an election officer on election day.
Discrimination Against Employee for Seeking Unemployment Insurance
Information:
Unemployment Insurance Code §1237 prohibits any business entity from discharging or otherwise discriminating against any person because such individual has (1) sought information from the Employment Development Department concerning his or her rights under either the Unemployment Insurance Code or the Labor Code, (2) has cooperated with any investigation undertaken by the department, or (3) has testified or is about to testify in any proceeding under the Unemployment Insurance Code or Labor Code.16
Accommodation for Alcohol and Drug Rehabilitation:
Labor Code §§1025-1028 provide that an employer must accommodate an employee to engage in Alcohol or Drug Rehabilitation.
Accommodation for Illiteracy:
An employee who reveals a problem of illiteracy may not be subject to termination of employment because of the disclosure of illiteracy if the employee is able to satisfactorily perform her job functions. Labor Code §1044.
Fingerprints or Photographs for Improper Purpose:
Labor Code §1051 provides that it is a misdemeanor for an employer to require an employee or job applicant, as a condition of securing or retaining employment, to submit to photographs or fingerprints for the purpose of furnishing them, or information concerning them, to any third party, if the photographs or fingerprints “could be used to the detriment of the employee or applicant.”
Polygraph Examinations:
A private employer cannot require an employee or job applicant to take polygraph or other similar tests as a condition of employment or continued employment. Labor Code §432.2(a). An employer may request employees or applicants to take such tests “voluntarily,” if the employer provides written notice of the employee’s rights guaranteed by Labor Code §432.2.
Discrimination in Employment:
The California Fair Employment and Housing Act17 prohibits discrimination in employment based upon the following:
The FEHA prohibits employment discrimination based on the following:
1. Race;
2. Religious creed;
3. Color;
4. National origin;
5. Ancestry;
6. Physical and mental disability;
7. Medical condition;
8. Marital status;
9. Sex or sexual orientation;
10. Age, with respect to persons who are 40 years of age or older;
11. Pregnancy, childbirth, or related medical conditions; and
12. Association.
The FEHA also prohibits retaliation against an employee for opposing discriminatory practices, filing a complaint, or testifying or assisting in any FEHA proceeding. Specifically, it is an unlawful employment practice for an employer to discriminate against any person for (1) opposing any practice forbidden or made unlawful under those laws, or (2) filing a complaint, making a charge, testifying, assisting, or participating in any investigation, proceeding, hearing, or litigation under those laws.18
Opposition to Employment Discrimination
“Opposition” may include complaints or protests to an employer, meetings with the employer or supervisors to discuss unlawful employment policies, refusal to participate in unlawful employment practices, and threatening to file a charge of employment discrimination.19 In E.E.O.C. v. Crown Zellerbach Corp.20, the Ninth Circuit Court of Appeals explained that an employment practice need not be demonstrably unlawful; there need only be a reasonable belief by the objecting person that the employer was engaged in unlawful practices.21
Participation in Employment Discrimination Proceedings
Employers may not retaliate against any employee who has “made a charge, testified, assisted, or participated” in employment discrimination proceedings.22 This protection extends to former employees. For example, in Robinson v. Shell Oil Co.,23 the employer provided a negative employment reference for a discharged employee who had filed a charge of discrimination against the employer. The United States Supreme Court found that former employees are covered by Title VII’s anti-retaliation provisions.
Supervisors and Employers Are Liable For Retaliation
Under the FEHA, a supervisor may be individually liable for retaliation. In Winarto v. Toshiba American Electronics Components, Inc.,24 the Ninth Circuit concluded that the plain meaning of FEHA’s retaliation provision25 is susceptible to only one interpretation: supervisors are “persons” and potentially liable for retaliation.26 The court distinguished the holding in Reno v. Baird27 that supervisors cannot be personally liable for discrimination under FEHA, since Government Code §12940(a) prohibits only “an employer” from discriminating in hiring and employment decisions.28
Prima Facie Case Of Retaliation
A prima facie case of retaliation may be established by showing (1) that the plaintiff engaged in a protected activity,29 (2) that the plaintiff was thereafter subjected to adverse employment action by his or her employer, and (3) that there was a causal link between the two.30
An action is cognizable as an adverse employment action if it is reasonable likely to deter employees from engaging in protected activity. Whether an employment action is adverse is, in part, a subjective standard. It is not entirely subjective because the conduct must be reasonably likely to deter the protected activity, even by the charging party.31
In Akers v. County of San Diego, the Fourth District of the California Court of Appeal held that adverse employment action sufficient to constitute retaliation is not limited to “ultimate” employment acts, such as a specific hiring, firing, demotion, or failure-to-promote decision.32 In Akers, the court found specifically that reduced promotional opportunities are a legally tenable basis to find the employer substantially and materially adversely affected the terms and conditions of the plaintiff’s employment on which to base a retaliation claim.33 An unfavorable evaluation may be actionable if the employee proves the employer used the evaluation as a basis to detrimentally alter the terms or conditions of an employee’s employment.34 A temporary employment agency may be liable for retaliation.35
Causation
A Plaintiff may prove a retaliatory motive by showing that he/she engaged in protected activities, the employer was aware of the protected activities, and the adverse action followed within a relatively short time.36 Even if a manager is not the ultimate decision-maker regarding the adverse action, the manager’s retaliatory motive may be imputed to the employer if the manager was involved in the decision.37 Causation may be inferred from circumstantial evidence.38
Retaliation often involves termination, demotion, or financial loss.39 These actions are not necessary to support a viable retaliation claim; your client need only show that an employer took some action in response to the exercise of protected rights. Even a refusal to transfer may be sufficient.40
1 Harden v. Maybelline Sales Corp. (1991) 230 Cal.App.3d 1550, 1555.
2 Guz v. Bechtel Nat’l, Inc., (2000) 24 Cal.App.4th 317, 339; Kovatch v. California Cas. Management Co., Inc. (1998) 65 Cal.App.4th 1256, 1276.
3 Guz v. Bechtel Nat’l, Inc., supra, 24 Cal.App.4th at 340.
4 Guz v. Bechtel Nat’l, Inc., supra, 24 Cal.4th at 344.
5 Kelecheva v. Multivision Cable T.V. Corp. (1993) 18 Cal.App.4th 521, 532-533.
6 See Labor Code §232(a), (b).
7 Labor Code §232(c).
8 Labor Code §232.5(a), (b).
9 Pitman v. City of Oakland (1988) 197 Cal.App.3d 1037, 1044. Plaintiff must allege that that arrest did not result in a conviction.
10 Labor Code §432.7(a).
11 Penal Code §637.3(a).
12 Labor Code §450(a); Labor Code §450(b).
13 Labor Code §451.
14 Civil Code §§56.10(a) – (c), 56.20(c), 56.30.
15 Civil Code §56.22.
16 Unemployment Insurance Code §1237(a).
17 California Fair Employment and Housing Act (“FEHA”); California Government Code §§12940 et seq.
18 Government Code §12940(h).
19 Iwekaogwu v. City of Los Angeles (1999) 75 Cal.App.4th 803, 815, 89.
20 E.E.O.C. v. Crown Zellerbach Corp. (9th Cir.1983) 720 F.2d 1008.
21 E.E.O.C. v. Crown Zellerbach Corp., supra, 720 F.2d 1008, 1013.
22 Government Code §12940(h) (FEHA).
23 Robinson v. Shell Oil Co. (1997) 519 U.S. 337.
24 Winarto v. Toshiba American Electronics Components, Inc. (9th Cir. 2001) 274 F.3d 1276.
25 Government Code §12940(h).
26 Winarto v. Toshiba American Electronics Components, Inc. (9th Cir. 2001) 274 F.3d 1276, 1287-1288; Page v. Superior Court (1995) 31 Cal.App.4th 1206, 1212 (FEHA unambiguously imposes personal liability for harassment or retaliation); Fisher v. San Pedro Peninsula Hosp. (1989) 214 Cal.App.3d 590, 615 (implying that 1987 amendment of FEHA’s retaliation provision adding “person” indicates legislative intent to extend liability to individuals).
27 Reno v. Baird (1998) 18 Cal.4th 640.
28 Winarto v. Toshiba American Electronics Components, Inc. (9th Cir.2001) 274 F.3d 1276, 1288; Peterson v. Santa Clara Valley Medical Center (N.D. Cal. 2000) 2000 U.S. Dist. LEXIS 953, *9-*10; Soo v. United Parcel Serv., Inc. (N.D. Cal. 1999) 73 F.Supp.2d 1126, 1129-1130; Liberto-Blanck v. City of Arroyo Grande (C.D. Cal. 1999) 33 F.Supp.2d 1241, 1243; Kaminski v. Target Stores (N.D. Cal. 1998) 1998 U.S. Dist. LEXIS 13977, *7 (all holding that Reno does not apply to retaliation).
29 See Flait v. North American Watch Corp. (1992) 3 Cal.App.4th 467, 476-479 (FEHA; mistaken, but sincere and reasonable, belief that plaintiff was opposing discrimination was sufficient); E.E.O.C. v. Dinuba Medical Clinic (9th Cir. 2000) 222 F.3d 580, 586 (filing criminal complaint against supervisor for assault and battery qualified as “opposition” activity).
30 Chen v. County of Orange (2002) 96 Cal.App.4th 926, 948 (FEHA); Akers v. County of San Diego (2002) 95 Cal.App.4th 1441, 1453 (FEHA, Labor Code §1102.5); Fisher v. San Pedro Peninsula Hospital (1989) 214 Cal.App.3d 590.
31 Vasquez v. County of Los Angeles (9th Cir. 2003) 349 F.3d 634, 646.
32 Akers v. County of San Diego (2002) 95 Cal.App.4th 1441, 1453-1457.
33 Akers v. County of San Diego (2002) 95 Cal.App.4th 1441, 1456-1457 (taking into account totality of circumstances, including language used in performance evaluation and counseling memorandum labeling deputy district attorney as dishonest, incompetent, and insubordinate, and evidence that top management demonstrated willingness to use information against her in significant employment decisions, was sufficient evidence for jury to find retaliatory actions after complaint of gender/pregnancy discrimination were adverse actions under the FEHA because they would preclude reasonable promotional opportunities.
34 Akers v. County of San Diego (2002) 95 Cal.App.4th 1441, 1457.
35 See Mathieu v. Norrell Corp. (2004) 115 Cal.App.4th 1174, 1185-1186.
36 Morgan v. Regents of University of California (2000) 88 Cal.App.4th 52, 69; Vasquez v. County of Los Angeles (9th Cir.2003) 349 F.3d 634, 647.
37 Bergene v. Salt River Project Agricultural Improvement and Power District (9th Cir. 2001) 272 F.3d 1136, 1141; Hernandez v. Spacelabs Med., Inc. (9th Cir. 2003) 343 F.3d 1107, 1114-1115.
38 Morgan v. Regents of University of California (2000) 88 Cal.App.4th 52, 69.
39 Ruggles v. California Polytechnic State Univ. (9th Cir.1986) 797 F.2d 782, 785 (Title VII); Bouman v. Block (9th Cir. 1991) 940 F.2d 1211, 1223 (Title VII).
40 Bouman v. Block (9th Cir. 1991) 940 F.2d 1211 (Title VII).
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