California Employment Law Update

Proskauer Scores Two Summary Judgments for Large Southern California Hospital Within 48 Hours

We’re delighted to report that we secured two summary judgments in two separate alleged discrimination cases on behalf of a large Southern California hospital in matters that were pending in the Los Angeles Superior Court.

In one case, decided on July 12, 2019, the Court agreed with our client that the former employee had failed to establish a prima facie case of discrimination and, as a result, all of her discrimination and retaliation claims were dismissed; the court ruled that the employee had been terminated for legitimate, nondiscriminatory reasons – she had worked “off the clock” and violated various policies and procedures of the hospital.

The hospital moved for summary judgment on all claims; the employee argued that the hospital’s reason for termination was “pre-textual” and was instead motivated by her purported disability, age, and her report of a “lunch break violation.”  Judge Dennis J. Landin determined that there was no triable issue of material fact because the employee failed to make a prima facie showing and then granted the hospital’s motion for summary judgment in its entirety.

And just two days before that, we defended the hospital in another lawsuit filed by a former employee who alleged claims of disability discrimination, retaliation, failure to provide reasonable accommodations, failure to engage in the interactive process, failure to maintain a discrimination free environment, retaliation, wrongful termination in violation of public policy, and violation of California Labor Code § 1102.5 (whistleblower).

In that case, decided on July 10, 2019, the hospital argued that the employee failed to establish a prima facie case of discrimination, that the hospital had reasonably accommodated her, and that it had terminated her for a legitimate nondiscriminatory reason – she consistently committed serious errors.

The hospital moved for summary judgment on all claims; the employee opposed and argued that the hospital’s reason for termination was “pre-textual” and was instead motivated by her purported disability and extended medical leave. Judge Richard J. Burdge, having found no evidence of pretext and no disputed issues of material fact, granted the hospital’s motion for summary judgment in its entirety.

The team on these two cases included partner Anthony Oncidi, and associates Pietro Deserio, Tulio Chirinos and Cole Lewis (Employment Litigation).

California Enacts Law Prohibiting Hairstyle Discrimination … with New York and New Jersey Close Behind

As we have reported before, California is set to become the first state to prohibit employers from discriminating based upon hairstyle. Last week, Governor Gavin Newsom signed into law the “CROWN Act” (Create a Respectful and Open Workplace for Natural Hair).

The CROWN Act amends the state’s Education Code and Government Code to define “race or ethnicity” as “inclusive of traits historically associated with race, including, but not limited to, hair texture and protective hairstyles.” The new law expressly defines “protective hairstyles” as including but not limited to “braids, locks, and twists.”

Introduced by Sen. Holly Mitchell (D-Los Angeles), the CROWN Act “protects the right of Black Californians to choose to wear their hair in its natural form, without pressure to conform to Eurocentric norms,” Mitchell said. Governor Newsom called the law “long overdue,” and the bill passed both the Senate and the Assembly unanimously. The new law takes effect on January 1, 2020.

Meanwhile, on the East Coast, both New York and New Jersey also are advancing laws that would protect against hairstyle-based discrimination.

In New York, SB 6209 would amend the definition of “race” under the New York State Human Rights Law (NYSHRL) to include “traits historically associated with race, including but not limited to, hair texture and protective hairstyles,” thus making it unlawful under the NYSHRL to discriminate on the basis of such traits in employment, as well as housing and in public accommodations.   The bill also would extend similar protections to students covered under the state’s Education Law.

Similarly in New Jersey, SB 3945 would expand the definition of “race” under the New Jersey Law Against Discrimination (which also prohibits discrimination in employment, housing, and public accommodations) to include “traits historically associated with race, including, but not limited to, hair texture, hair type, and protective hairstyles.”

Like the California law, the New York and New Jersey bills define “protective hairstyles” to include hairstyles such as braids, locks, and twists.

The New York bill is currently before Governor Andrew Cuomo, who is expected to sign.  The New Jersey bill is still being considered by the state Senate and Assembly Labor Committees.  Both bills, if signed, would take effect immediately.

UPDATE: Governor Andrew Cuomo signed the New York bill into law on July 12, 2019 (effective immediately).

“Bikini Baristas” Ordered to Cover-Up

The 9th Circuit court of appeals has enforced the City of Everett, Washington’s Dress Code Ordinance and amendments to the Lewd Conduct Ordinances. These ordinances require employees of “Quick-Service” facilities to cover “minimum body areas” (the dress code ordinance specifically stated that it was targeting an apparent influx of “bikini barista stands”). The owner of “Hillbilly Hotties,” a coffee stand where employees wear only bikinis, and several of the bikini baristas themselves challenged the ordinances as unconstitutionally vague. Plaintiffs also alleged that the Ordinances violated their First Amendment right to free expression.

The Court of Appeals reversed a lower court ruling that prohibited enforcement of the Ordinances on the ground that they are unconstitutionally vague. The appeals court explained that a person of ordinary intelligence would be able to understand the terms in the Ordinance and would be adequately informed of which body areas cannot be exposed or displayed.

The Ninth Circuit also concluded that Plaintiffs’ first amendment claim faltered based upon their failure to show a great likelihood that their intended message would be understood by those who received it. The court found that the baristas’ acts of wearing pasties and g-strings in close proximity to customers did not necessarily convey the baristas’ purported message of female body confidence and empowerment.

Read the full decision here.

California Jury Awards $15.4 Million to Former Jack in the Box Employee

In a decision unsurprising to anyone familiar with what California juries have been up to lately (see our reporting here), fast-food titan Jack in the Box was ordered to pay $15.4 million (including a staggering $10 million in punitive damages) last week in a lawsuit involving age and disability discrimination claims, as well as alleged retaliation and hostile work environment.

The former employee, Blanca Ramirez, alleged that she suffered two job-related injuries and that she was never offered accommodations. Ramirez, age 53 at the time she was discharged, alleged that her boss called her “grandma” in response to the way that she moved around the restaurant.

Ramirez also alleged that Jack in the Box fired her due to her two complaints about sexual harassment in the workplace. Ramirez alleged that she complained about a manager being involved in a “bizarre love-triangle” with two subordinates as well as a 22-year-old supervisor engaging in “serious misconduct” with at least two 16-year-old subordinates.

Jack in the Box denied Ramirez’s allegations and contended it fired Ramirez for manipulating the restaurant’s internal system for measuring “employee performance metrics.” Jack in the Box produced evidence in the form of video images of Ramirez’s alleged actions in that regard.  Ramirez’s attorney commented after the verdict:  “Jack in the Box in their SEC filing didn’t really mention two sexual harassment complaints my client filed as an employee supervisor.  They really screwed this thing up.”

The jury sided with Ramirez, finding that Ramirez’s age was a “substantial motivating reason” for the company’s decision to fire her. The jury also found that she was fired due to her disabilities as well as her complaints about sexual harassment and a hostile work environment. The final verdict came to $15.4 million, with nearly double the amount of punitive damages ($10 million) as compensatory damages for lost wages and emotional distress ($5.4 million).

Ah, It’s Bill Passing Season in California – and No Employer is Safe!

It’s springtime in California!  Even as the swallows return to San Juan Capistrano, the California legislature is busy, busy, busy passing 100s of new laws because, after all, you can never get too much of a good thing!

Yes, it’s Bill Passing Season in Sacramento again, and the California legislature seems as determined as ever to defend the state’s vaunted position as “#1 Judicial Hellhole” in the Nation!

Here’s the state of play so far – the State Assembly passed six new bills that would further add to a California employer’s to-do list:

  • AB-51 (Gonzalez, D-San Diego) is the legislature’s perennial attempt to outlaw arbitration in employment contracts, as we have reported before. Just like its predecessors, this bill is likely preempted by federal law (the Federal Arbitration Act) despite its declared intent not to invalidate agreements that are otherwise enforceable under the FAA.  Former Gov. Jerry Brown repeatedly refused to sign similar bills.  (We predict that Gov. Newsom may not be quite as punctilious.)
  • AB-171 (Gonzalez, D-San Diego) provides a “rebuttable presumption” of unlawful retaliation if within 90 days of notice to the employer of sexual harassment, domestic violence, stalking, or sexual assault, the employee suffers an adverse action (e.g., discharge, demotion, suspension, etc.) by the employer.
  • AB-196 (Gonzalez, D-San Diego) guarantees 100 percent wage replacement (up to the maximum weekly amount available for workers’ compensation temporary disability benefits) when workers access California’s Paid Family Leave.
  • AB-500 (Gonzalez, D-San Diego) provides paid leave of six weeks for employees of school districts, charter schools, and community colleges who suffer pregnancy-related disabilities (pregnancy, miscarriage, childbirth, recovery).
  • AB-1066 (Gonzalez, D-San Diego) makes striking employees eligible to receive unemployment benefits after the first four weeks of a trade dispute – currently, only employees who leave work due to a lockout are eligible for benefits.
  • AB-5 (Gonzalez, D-San Diego) codifies the Dynamex decision, making it nearly impossible for most employers to classify a worker as an independent contractor. Adopting this new standard could cost California businesses as much as $6.5 billion in additional payroll expenses.

Meanwhile, the State Senate passed some new bills of its own affecting employers:

  • SB-142 (Wiener, D-San Francisco) expands upon the existing requirement to provide nursing mothers a private space to express milk. The requirement for lactation accommodation, which was updated in the last legislative session, is further fine-tuned under SB-142, with the requirement that a lactation space contain a surface to place a breast pump and personal items, a place to sit, and access to electricity.  An employer also would be required to provide access to a sink with running water and a refrigerator or other cooling device in close proximity to the employee’s workspace.
  • SB-171 (Jackson, D-Santa Barbara) requires employers with 100 or more employees (which are already required to submit EEO-1 reports to the EEOC) to submit annual pay data reports to the state Department of Fair Employment and Housing, showing employee compensation and hours worked by gender, race, ethnicity and job category.
  • And finally, SB-37 (Skinner, D-Berkeley) would raise the corporate tax rate for businesses in California from 8.84% to a new rate ranging between 10.84% and 14.84% (i.e., an increase of between 23% and 68%).  If this latest tax increase passes, California will have achieved the Tax Trifecta:  The highest personal income tax rate (13.3%), state sales tax rate (7.25%) and corporate tax rate in the nation.  This latest increase in taxes comes amidst a record $21.5 billion budget surplus in Sacramento.

These bills now go to the other house of the legislature for review. The full legislature will or won’t pass them by September 13 after which time the lucky winners will head to Gov. Gavin Newsom for approval.

May 2019 California Employment Law Notes

We invite you to review our newly-posted May 2019 California Employment Law Notes, a comprehensive review of the latest and most significant developments in California employment law. The highlights include:

View PDF

California Bill Aims to Prohibit Employers from Discriminating on Basis of Hairstyle

A new California bill aims to make it illegal for employers to discriminate against employees based upon their hairstyles. SB 188, also known as the “CROWN Act” (Create a Respectful and Open Workplace for Natural hair), proposes amending the Education Code and Government Code to define “race or ethnicity” as “inclusive of traits historically associated with race, including, but not limited to, hair texture and protective hairstyles.” The bill expressly defines “protective hairstyles” as including but not limited to “braids, locks, and twists.”

The preamble to SB 188 notes that “workplace dress code and grooming policies that prohibit natural hair, including afros, braids, twists, and locks, have a disparate impact on Black individuals as these policies are more likely to deter Black applicants and burden or punish Black employees than any other group…. [H]air today remains a proxy for race.”  The bill, which was introduced by Sen. Holly Mitchell (D-Los Angeles), further states that “hair discrimination targeting hairstyles associated with race is racial discrimination.”

The CROWN Act passed 37-0 in the Senate and has been referred to the Committee on Judiciary.

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