California Supremes Expanding Employment Law Docket

The California Supreme Court is taking up several cases for review that will have significant effects on California employment law.  Once the Supreme Court grants review, the lower court opinion is not precedent and cannot be cited in briefs or relied upon unless the Court says otherwise.

Here are two recent "grants," courtesy of the California bar's employment law section email blast (and thank you, Phyllis Cheng as always):

In this case, the court of appeal expanded appellate review of arbitration decisions beyond what was previously the law.  One of the reasons parties turn to arbitration is finality - no appeals unless there are very specific circumstances.  This case carved a huge loophole.  This case also rejected the employer's argument that it had an "honest belief" that an employee was faking the need for medical leave, justifying discharge.

Richey v. Autonation, Inc. (2012) 149 Cal.Rptr.3d 280 (SC S207536/B234711review granted 2/13/13) CFRA/honest belief defense Petition for review after the Court of Appeal reversed the judgment in a civil action. This case presents the following issues: (1) Is an employer’s honest belief that an employee was violating company policy or abusing medical leave a complete defense to the employee’s claim that the employer violated the Moore-Brown-Roberti Family Rights Act (Gov. Code, §§ 12945.1, 12945.2)? (2) Was the decision below to vacate the arbitration award in the employer’s favor consistent with the limited judicial review of arbitration awards? Review granted/brief due.

This one is a "grant and hold" that likely will depend on the outcome of the pending Iskanian decision, which addresses overlapping issues.  The Court is going to decide whether class action waivers are lawful in California after the U.S. Supreme Court's decision in ATT Mobility v. Concepcion.

Franco v. Arakelian Enterprises, Inc. (2012) 149 Cal.Rptr.3d 530 (SC S207760/B232583 review granted 2/13/13) Class Action Waiver Petition for review after the Court of Appeal affirmed an order denying a petition to compel arbitration in a civil action. The court ordered briefing deferred pending decision in Iskanian v. CLS Transportation Los Angeles, LLC, S204032 (#12-97), which includes the following issue: Did AT&T Mobility LLC v. Concepcion (2011) 563 U.S. __ [131 S.Ct. 1740, 179 L.Ed.2d 742] impliedly overrule Gentry v. Superior Court (2007) 42 Cal.4th 443 with respect to contractual class action waivers in the context of non-waivable labor law rights?  Review granted/briefing deferred. The High Court of course has a number of other significant employment law cases pending. f you want to review all of the cases the California Supreme Court has on its docket (employment law and otherwise), the Court keeps a list here.

Court of Appeal: Statutory PDL Maximum Isn't

In California, employees disabled by pregnancy are entitled to up to four months of job-protected leave during any period in which they are disabled.  The leave has not length of service requirement.  There is no employer job-site requirement either.  And those employees eligible for California Family Rights Act leave may have up to 12 weeks of that for baby bonding.   The California Family Rights Act does not include pregnancy disability as a "serious health condition."   So, time under that law does not run during pregnancy disability.  Get it?  If not, don't feel like you're the Lone Ranger. It's one of California's most confusing sets of laws.

So, what happens when an employee is disabled by pregnancy and uses up all four months of PDL before delivering the baby, or before  she is able to return to work?  We know the 12 weeeks of FMLA leave (if employee is eligible) are exhausted, because FMLA does run during pregnancy disability.  The CFRA time did not start to run yet unless the employer and employee agree, because pregnancy disability is not a covered condition under CFRA.  Can it be that a worker in California could run out of medical leave and be denied reinstatement?

Nah. The PDL statute's four months of leave, and the potential for seven months of combined PDL/CFRA, are not the last word on leaves for those with long periods of pregnancy disability.  How can this be?

Swissport gave its employee, Ana Sanchez, nineteen weeks of leave. That's all the four months of PDL and then tacked on her unused vacation time.  But Fuentes had not yet given birth.  She was due in October. But, her leave exhausted in July, Swissport terminated her employment. Sanchez sued, claiming, among other things, that Swissport owed her more leave as a form of "reasonable accommodation" under California's anti-disability discrimination provisions contained in the Fair Employment and Housing Act.  The trial court dismissed her case because Swissport had provided her with all statutory leave to which she was entitled.

Leave in excess of statute, however, can be a form of "reasonable accommodation" under disability discrimination law.  Under California law it has to be reasonably definite in duration and effective, meaning that it is likely that at the end of a reasonably definite leave, the employee will be able to perform her essential job functions, with or without accommodation.

So, stautes collide; judges have to sort out the wreckage.  Here, the Court of Appeal decided that the limiting language in the PDL statute does not "supplant" the general obligation to grant reasonable accommodation to an employee with a disability.  That also means that the employee is not entitled to indefinite leave, or additional leave that would cause undue hardship.  In this case, however, the employer discharged the employee for exceeding four months of leave, without any "interactive process" or attempt to accommodate.

The bottom line, then, is that most employees disabled by pregnancy will be entitled to leave until they recover from childbirth, unless the period of leave sought is indefinite, or undue hardship would result.

This case is Sanchez v. Swissport and the opinion is here.

Court of Appeal: No Reinstatement after 12 weeks of CFRA Leave

After taking 19 weeks of leave, the first 12 of which was covered under the California Family Rights Act, LA County reinstated Katrina Rogers, but then transferred her to a new job as a business decision. Rogers did not take the transfer well and sued under various causes of action, including the CFRA.  A jury awarded her damages and the county appealed.

The court first rejected Rogers' argument that the transfer amounted to "interference" with her rights under the CFRA:

Here, the following is undisputed—the County accorded Rogers the full 12 workweeks of leave to which she was entitled under the CFRA; Rogers did not return to work at the end of this period, but instead remained on leave for 19 weeks; and the decision to transfer her was made within the 12-week leave period, but never communicated to Rogers during her leave. Rogers nevertheless argues that she suffered interference with her CFRA rights because the transfer decision was made during her protected CFRA leave. But she cites no authority to support her position, which we therefore disregard. (Perez v. Grajales (2008) 169 Cal.App.4th 580, 591–592.) Based on the foregoing, we conclude that Rogers’s right to reinstatement expired when the 12-week protected CFRA leave expired. Her CFRA interference claim therefore fails as a matter of law, and should never have been submitted to the jury.

 
Then the court turned to Rogers' claim that the transfer was "retaliation" for her exercising her rights. The court could not find any evidence that the county took its action because Rogers took leave, other than the fact that she took it and the transfer occurred thereafter:

In short, Rogers “failed to establish the requisite causal connection between her protected actions in taking a CFRA medical leave” and the decision to transfer her to another position. (Neisendorf, supra, 143 Cal.App.4th at p. 519.) “The unchallenged finding that [the County] had a legitimate, nondiscriminatory reason to [transfer Rogers], which had nothing to do with her CFRA leave, bars [Rogers] from articulating a cognizable cause of action for the jury’s consideration based on [the County’s] alleged refusal to honor the CFRA’s right to reinstatement.” (Id. at p. 520.) The Neisendorf court cited to several federal courts interpreting the FMLA that endorse this principle. (See e.g. Throneberry v. McGehee Desha County Hosp. (8th Cir. 2005) 403 F.3d 972, 979 [“‘As long as an employer can show a lawful reason, i.e., a reason unrelated to an employee’s exercise of FMLA rights, for not restoring an employee on FMLA leave to her position, the employer will be justified to interfere with an employee’s FMLA leave rights’”].) Like the Neisendorf court, we conclude that because the County’s “legitimate, nondiscriminatory reason” for the decision to transfer Rogers eliminated any obligation the County might have had to reinstate her, Rogers “could not state a valid claim under the CFRA.” (Neisendorf, supra, at p. 520.)

The decision is important regarding CFRA/FMLA leave, but it does not address reasonable accommodation obligations under the ADA/Fair Employment and Housing Act.  So, employers still need to consider reinstatement following extended leave when an employee has a covered disability and takes more leave than allowed under CFRA / FMLA.

The case is Rogers v. County of LA and the opinion is here.

FEHC Updates FMLA / CFRA Comparison Chart

California's anti-discrimination agency just updated its chart comparing the FMLA and California's CFRA. It's posted here.

California FEHC Compares New FMLA Regulations with CFRA/PDL

The California Fair Employment and Housing Commission issued a helpful comparison chart covering the new FMLA regulations and their effect on California's Family Rights Act and Pregnancy Disability Leave law. Here it is.

CA Supreme Court Rules on California Family Rights Act Issues

So, Lonicki was an employee claiming major depression and work-related stress stopped coming to work and requested medical leave. In the employer’s view, the employee did not have a serious health condition and was capable of performing her duties. The employer ordered the employee to return to work, and fired her when she did not. The twist: While taking FMLA/CFRA leave, she worked for another employer. While her other job was not identical, there was a substantial overlap.
The Supreme Court considered two issues: First, could the employer just fire Lonicki without seeking additional medical certifications as provided by the CFRA statute? The court concluded (6-1) that employers need not do so. Justice Moreno, though, said that the employer must follow that procedure before denying leave based on an employer's belief that the employee is not eligible for leave.
The second issue is the one that got the headlines: If an employee seeks FMLA/CFRA leave for her own health condition, and she works another job, does she really have a serious health condition? Here, the Supreme Court split 4-3 that she MIGHT. The court decided that working another position is evidence that the employee's condition might not qualify for FMLA or CFRA. But the Court refused to hold that working in a comparable job was "conclusive" evidence no serious health condition justified leave. So, off to trial with Lonicki and her employer.

The case is Lonicki v. Sutter Health Central and the opinion is here.