Are You Sure You Know Retaliation When You See It?

Are You Sure You Know Retaliation When You See It?

By Hugh A. McCabe

Employers Need to be on Guard in the Workplace

Employers need to be on guard to protect themselves against claims brought for employment discrimination based upon retaliation as California has a liberal view of the employee’s right to sue for retaliation.

Employee Claims for Retaliation

In order to establish a claim for retaliation, an employee must establish he or she engaged in “protected activity” (i.e. opposed unlawful conduct); that he or she was subjected to an "adverse employment action” because of that activity; and that he or she suffered damages.

California Supreme Court Broadened the Scope for Retaliation Claims

In a case before the California Supreme Court, a regional sales manager alleged she was repeatedly ordered by a male superior to terminate a female sales associate who, in the superior’s view, was not sufficiently attractive. The manager asked for an “adequate justification” before she would terminate the sales associate. After no justification was given the manager refused to comply with the termination order. In the manger’s lawsuit she stated she refused the order because she felt it was sex discrimination, but admits she never told her superior, nor any one else about her belief the order was discriminatory. Subsequent to her refusal to terminate the sales associate, she claimed she was subjected to increasingly hostile adverse treatment, which included management soliciting negative information about her and increased verbal and written criticism of her performance.

In a 4-2 decision, The California Supreme Court concluded the sales manager sufficiently alleged facts to support her claim for retaliation and raised a triable issue she had been subjected to materially adverse employment actions. (Yanowitz v. L’Oreal USA INC. (2005) 36 Cal. 4th 1028) This case changed what California courts would consider is an “adverse employment action” and expanded what will be considered a “protected activity” by the employee.

Previous Views of “Adverse Employment Action”

The term “adverse employment action” is not specifically defined by California or federal law, but is more commonly known as referring to the kind, nature, or degree of adverse action against an employee that will support a cause of action under a relevant provision of an employment discrimination statute. (Powers v. Summers (7th Cir. 2000) 226 F.3d 815, 820).

A few courts have held an adverse employment action need only deter employees from engaging in protected activities. This is known as the “deterrence standard.”

The Court Resolved "Adverse Employment Action”

The Supreme Court resolved this long standing dispute among lower courts as to the definition of “adverse employment action.” The Court in Yanowitz held an adverse employment action is one that “materially” impacts an employee’s terms and conditions of employment and rejected the broader “deterrence standard.” However, the Supreme Court gave an expansive reading to the “materiality test.” Under a FEHA claim for retaliation the Supreme Court held employees are protected from “the entire spectrum of employment actions that are reasonably likely to adversely and materially affect an employee’s job performance or opportunity in his or her career.” (Yanowitz v. L’Oreal USA INC. at 1053) The Supreme Court also held courts should look at the totality of the employer’s action to see if they rise to the level of having a material impact on the employee. In its ruling the Court made two important distinctions to an adverse employment action. First “material impact” does not require the employee suffer an economic detriment or psychological injury to state a claim for retaliation. Second, there is no requirement the employer’s retaliation constitute one swift blow, rather than a series of subtle, yet damaging injuries.

The Expansion of a “Protected Activity”

In general, under a FEHA claim for retaliation, to constitute a “protected activity,” an employee must complain or oppose a practice which is forbidden by FEHA (e.g. sex, race, or age discrimination). Yet courts have held “protected activity” includes complaints or opposition to conduct the employee “reasonably” and in “good Faith” believes to be unlawful, even if the conduct is not actually prohibited under FEHA.

The Court in Yanowitz went further to add a subtlety to what constitutes a “protected activity.” The Supreme Court held “protected activity” occurs “when the circumstances surrounding the employee’s conduct are sufficient to establish an employer knew that an employee’s refusal to comply with an order was based on the employee’s reasonable belief that the order is discriminatory . . . [and] the employee [need] not explicitly inform the employer that she believed the order was discriminatory.” (Yanowitz v. L’Oreal USA INC. at 1048)

To clarify its ruling the Court explained, standing on its own, an employee’s belief her employer is engaging in unlawful conduct is not sufficient to establish the employee engaged in a protected activity. However, the Court reasoned an employee need not actually complain of discrimination in any specific language so long as she adequately communicates her belief that the employer is engaging in unlawful conduct.

Lowering the Bar in Retaliation Claims

The Court in Yanowitz did not provide a bright line test employers can use to determine when an employee is engaging in a protective activity or when an employer’s subsequent actions may be considered adverse. The broad definitions of “adverse employment action” and “protected activity” set forth in Yanowitz increase employers potential liability and places a greater burden on employers to be proactive at the workplace concerning complaints of unlawful behavior and preventing any retaliatory behavior may be construed as a material adverse employment action.

Employers Need to be Proactive

Employers need to make sure they have an express and well publicized policy prohibiting discrimination, harassment and retaliation in the workplace. Employers also should have options available for employees to raise concerns or complaints regarding unlawful conduct in the workplace. Such concerns should be taken seriously, promptly investigated and appropriate measures taken for corrective action. Particular attention should be paid to ensure the complaining employee is not reprimanded for coming forth with a concern.


This article appeared in the April 16, 2007 issue of the San Diego Business Journal.

Hugh A. McCabe is a shareholder at Neil Dymott and concentrates his practice on the defense of employers. Mr. McCabe focuses on the areas of wrongful termination, discrimination, sexual harassment and the Family and Medical Leave Act. Mr. McCabe may be reached at (619) 238-1712 or hmccabe@neildymott.com

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