San Francisco Employment Law Firm Blog

The recently published case, DFEH v Lyddan Law Group, decided by the agency that reviewing DFEH decision, reaffirms that fact that an employee is unlikely to prevail on a racial discrimination/harassment claim when his/her boss makes racial jokes, off-color comments with regard to different races in an apparent desire to entertain himself and his colleagues and staff members. As inappropriate and as offensive racist jokes at workplace might be, especially when they originate from a manager who is an attorney-partner in a San Francisco law firm, like it was in this case, these jokes do not mean that the alleged harasser discriminates or that he creates an hostile work environment, especially if the relationship between him and the alleged victim is otherwise good and if the alleged victim does not complain about the harassment and does not make it known in any way that he/she is unhappy about the comments she hears.

Both, the Department of Fair Employment and Housing and the Court will require more than isolated racist jokes to find racial harassment or discrimination at workplace. Not all conduct at workplace that can be described as harassing creates liability under FEHA and the related anti-discrimination laws. As the Supreme Court has stated, the statutory protections against harassment do not create a “general civility code.” Oncale v. Sundowner Offshore Services (1998) 523 U.S. 75, 81. There has to be a showing that the employer created or failed to remedy objectively intolerable working conditions for the victim. The requisite standard involves a shoring that the harasser’s conduct would have interfered with a reasonable employee’s work performance, seriously affecting the psychological well-being of a reasonable employee and that the alleged victim was actually offended. As the court stated in Aguilar v. Avis Rent A Car System, Inc., (1999) 21 Cal.4th 121, 130, “not every utterance of a racial slur in the workplace violates the FEHA or Title VII.”

In this particular case, the DFEH also hinted in their decision that they also believe that at least one reason the employee brought a claim for racial discrimination against her boss was that she was denied her annual bonus and salary increase in a prior year.

The protections afforded to employee under the Federal and State disability laws are quite expansive and go far beyond protecting just those employee who have a “disability” the way an ordinary person would understand the term, such as being handicapped, or having suffered from a major traumatic injury. The US Supreme Court case School of Board of Nassau County, Florida, v. Arline, 481 U.S. 1024 (1987) is an illustration of this broad application of the disability laws at workplace. In that case, a school teacher was fired from her job solely because of her susceptibility to tuberculosis. The school argued that in removing the teacher from her position, they were protecting the safety of others by preventing the teacher from infecting students and administration with the contagious effects of tuberculosis during a possible relapse. However, the Supreme Court was not persuaded, noting that allowing discrimination based on the contagious effects of a physical impairment would be inconsistent with the basic purpose of section 504 (Rehabilitation Act) which is to ensure that handicapped individuals are not denied jobs or other benefits because of the prejudiced attitudes or ignorance of others. The fact that some persons who have contagious disease may pose a serious health threat to others under certain circumstances does not justify excluding from the coverage of the Act all persons with actual or perceived contagious diseases. Such exclusion would mean that those accused of being contagious would never have the opportunity to have their condition evaluated in light of medical evidence. Rather, they would be vulnerable to discrimination on the basis of mythology – precisely the type of injury Congress sought to prevent.

The Court further agreed American Medical Association that to determine whether the Plaintiff was otherwise qualified for her position, an individualized inquiry should have been made, which was to include “findings of fact, based on reasonable medical judgments given the state of medical knowledge about (a) the nature of the risk (how the disease is transmitted), (b) the duration of the risk (how long is the carrier infectious”, (c) the severity of the risk (what is the potential harm to third parties) and (d) the probabilities the disease will be transmitted and will cause varying degrees of harm.”

In Doe v Lincoln Unified School District, the Third District extensively discusses the rights of California certificated employees within California Education Section 44942, which provides a summary procedure for suspending or transferring to other duties a certificated school employee where there is reasonable cause to believe the employee “is suffering from mental illness of such a degree as to render him or her incompetent to perform his/her duties.” Upon suspension or transfer under the section, the governing board of the school district must provide the employee with “a written statement of the facts giving rise to the board’s belief, and an opportunity to appear before the board within 10 days to explain or refute the charges.” If, after such appearance, the board decides to continue the suspension, of if the employee does not appear, the employee is given an opportunity to be examined by a panel of three psychiatrists or psychologists selected by the employee from a list provided by the board.

The panel’s examination shall be at the school district’s expense and must take place within 15 days of the suspension or transfer. A written report must be submitted by the panel to the board within 10 days and shall contain a finding as to “whether the employee is suffering from mental illness of such a degree as to render him/her incompetent to perform his/her duties.” During this process, the employee shall continue to receive his regular salary and all other benefits of employment.

If the panel concludes the employee should be permitted to return to his prior duties, the board must reinstate the employee to his position and expunge from the employee’s personnel file all references to the suspension and the panel’s determination. If, on the other hand, the panel determines that employee is suffering from a mental illness sufficient to render him incompetent to perform his duties, the board may place the employee on mandatory sick lave for a period not to exceed two years.

Yesterday, I attended my client’s mediation at EEOC (Equal Employment Opportunity Commission) office in San Francisco. In many ways, the proceedings were very similar to a typical private mediation of an employment case. However, I thought there were a few important advantages, at least in this particular case, over private mediation.

1. The EEOC mediation service is free. Mediation can be an expensive proceeding. Some of the mediators in the Bay Area who are know to be effective in resolving employment cases charge between $5,000 and $7,000 per day for their services. While paying half of this fee may be worthwhile for the Plaintiff, some employers use this expense as an additional way to pressure Plaintiff into settlement. They realize that consciously or subconsciously, the employee and his/her counsel who are naturally are not as well funded as the employer will want to make their expense worthwhile and would be more frustrated if the case doesn’t settle at the end of the day, which means the aggrieved employee and his/her lawyer will likely be more flexible and amenable to a lower settlement. When the mediation is free, Plaintiff is under no pressure to accept settlement offer which seems to be clearly not fair.

2. At least some EEOC mediators seem to insist on a joint session before separating the parties into different rooms. Many private mediators believe that traditional join sessions, where both parties, their counsel and the mediator sit together and talk about the case are counter-productive and are more likely to hurt and help the process. While this might be true, especially if either of the parties or both or angry and each other and have a hard time communicating with each other without losing their temper, if respectful discussion is possible and the employee can keep his emotions under control, joint session should definitely be taken advantage of. First, it saves a lot of time, allowing both parties to nail down the main issues in their case and immediately see where the opposite side stands on the same issue. Some of the factual disputes, discrepancies and misunderstandings about the events that lead to the EEOC complaint can be resolved right then and there. Further, if the employer is represented by someone who has never met the aggrieved employee, it shows both parties the actual “human” side of the opposing party. This is especially helpful if the employer’s representative and the employee are calm and likable people, who are able to respect the difference in opinion when looking at the same issue from a different angle, which is very common in most motive-related cases, such as discrimination and retaliation.

The recent Silguero v. Creteguard, Inc., appellate decision from the Second Appellate district (Los Angeles County) is instructive on a less common issue arising out of the attempt by an employer to follow a non-compete agreement that the subject claimant signed with his former employer. In that case, shortly after claimant was terminated by his first employer, with whom he signed the non-compete agreement, she found employment with the defendant company. The first employer contacted the defendant and requested “cooperation” in enforcing the non-compete. As a result, claimant’s employment was terminated by the defendant.

While the new employer had the best intentions of acting honestly and ethically toward the other company (previous employer) and trying to do the right thing, even though they suspected that the non-compete agreement might be unenforceable in California, the court still found that the future employer was liable for wrongful termination. The court’s analysis largely relied on a very significant, and long standing public policy in California that protects the important legal right of persons to engage in businesses and occupations of their choosing and discourages circumvention of freedom to seek employment anywhere in the state.

The Court of Appeal further reminded the defendant-employer that a competitor may solicit another competitor’s employees if they do use unlawful means or engage in acts of unfair competition. Thus, no actionable wrong is committed by a competitor who hires away his competitor’s employees who are not under contract, as long as the inducement to leave the first employer is not accompanied by unlawful conduct.

Decisions concerning medical staff membership and privileges are made through a process of hospital peer review. Every licensed hospital is required to have an organized medical staff responsible for the adequacy and quality of the medical care rendered to patients in the hospital. Arnett v. Dal Cielo 14 Cal.4th 4, 10 (1996). The medical staff must adopt written bylaws which provide formal procedures for the evaluation of staff applications and credentials, appointments, re-appointments, assignment of clinical privileges, appeals mechanisms and such other conditions which the medical staff and governing body deem appropriate.

The medical staff acts mainly through peer review committees, which, among other things, investigate complaints about physicians and recommend whether staff privileges should be granted or renewed. California has codified the peer review process in Business and Professions Code section 809 et seq. The primary purpose of the peer review process is to protect the health and welfare of the people of the state by excluding through the peer review those medical practitioners who provide substandard care or who engage in professional misconduct. This process also allows hospitals to remove incompetent physicians from a hospital’s staff to reduce exposure to possible malpractice liability. Kibler v. Northern Inyo County Local Hospital Dist. 39 Cal.4th 192, 199 (2006). Another purpose which is equally important is to protect the employment and the rights of competent medical doctors from being barred from practical of medicine for arbitrary and discriminatory reasons. As one court noted, peer review that is not conducted fairly and results in the unwarranted loss of a qualified physician’s right or privilege to use a hospital’s facilities deprives the physician of a property interest directly connected to the physician’s livelihood. Anton v. San Antonio Community Hosp. 19 Cal.3d 802, 823 (1977).

The effect of denying staff privileges extends beyond reducing or eliminating a doctor’s access to the facility that denies the privileges. The same hospital is required by section 805(b) to report certain disciplinary actions to the Medical Board. A hospital considering whether to grant or renew a physician’s staff privileges must contact the Medical Board to learn if some other facility has reported a disciplinary action involving the physician as per section 805.5(a). A hospital is also usually required to report disciplinary actions to the National Practitioner Data Bank, established for the purpose of tracing the activities of incompetent physicians. 42 U.S.C. 11133(a). Thus, a hospital’s decision to deny staff privileges may have the effect of ending the physician’s career. Mileikowsky v. West Hills Hosp. and Medical Center (2009).