Federal and state lawmakers have kept employers on their toes lately. Issues affecting the U.S. workforce have taken center stage at the Capitol, sparking rumors of significant legislative overhaul in the employment arena. However, unbeknownst to many, while the debate on employment law reform gained traction, the California Supreme Court was positioning itself for a more subtle, but equally significant, strike on Fair Employment and Housing Act (“FEHA”) employment discrimination lawsuits.

In mid-February, the Supreme Court issued its opinion in a FEHA employment discrimination case entitled Harris v. City of Santa Monica. Harris filed a lawsuit against her former employer, a city-owned bus service, arguing she had been fired because she was pregnant, a recognized form of gender discrimination in California. The employer disagreed, stating Harris had been let go for poor work performance. The employer argued in the seven months Plaintiff was employed as a probationary, at-will employee, she reported late to work twice and was found responsible for causing two preventable accidents. When she was hired, the employer provided her with a copy of the company’s employment performance guidelines, which listed both tardiness and preventable accidents as punishable offenses.

Plaintiff’s personnel file gave her former employer a decisive edge, but Harris closed the gap by offering harmful testimony about her ill-timed termination, which came just days after she revealed to her employer she was pregnant. According to Harris, her supervisor was less than pleased to hear the news. The supervisor requested Plaintiff provide management with a doctor’s note permitting her to continue working. She obliged and submitted a note clearing her with a few limited restrictions. However, she was fired shortly thereafter.

This type of discrimination lawsuit is classified as a mixed-motive case and from 50,000 feet; the design seems straight forward. Mixed-motive cases involve situations where both legitimate and discriminatory considerations appear to have motivated adverse action. In the employment context, evidence of legitimate, non-discriminatory considerations, such as inferior work performance, is offered to negate allegations of unlawful discrimination. Theoretically, where an employer can prove it would have taken the same action with or without considering any discriminatory factors, the employer should not be held liable or at least should have less exposure. Right?

When the time came to instruct the jury, the trial Court struggled with these questions. The employer in this case had asked the Court to instruct jurors to find it not liable if the jury determined the employer would have taken the same action based solely on legitimate, non-discriminatory grounds. The trial Court denied defendant’s request and instead instructed the jury to determine whether the discrimination was “a motivating factor/reason” for Plaintiff’s termination. The jury returned with a verdict for the employee.

On appeal, the Supreme Court re-evaluated the mixed-motive defense on a microscopic level, to determine if and how it should be applied in the employment discrimination context. The Court ultimately concluded the mixed-motive defense did apply and further, that the trial Court had erred by refusing to give the instruction. The case was then remanded for further consideration with a few instructional words of wisdom from the high Court.

The Supreme Court took an in-depth look at the legislative intent behind California anti-discrimination laws. Provisions of the FEHA concerning employment discrimination were enacted to perform two key functions: first, to provide redress to victims of unlawful employment practices; and second, to discourage employers from engaging in such practices. The statutory text, on the other hand, was not as clear. Specifically, section 12940 of California’s Government Code states it is unlawful for an employer to take adverse action against an employee “because of” their “race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, or sexual orientation”. The employer in this case argued the “because of” language should be interpreted to require a direct link between the employer’s consideration of a protected characteristic and the resulting decision to act. Plaintiff advocated for fewer causation.

The Court concluded the express purposes of the FEHA would be best served by taking an intermediary approach. When a plaintiff has shown by a preponderance of the evidence that discrimination was a substantial factor motivating his or her termination, the employer should then be entitled to demonstrate that legitimate, nondiscriminatory reasons, standing alone, would have led it to make the same decision. However, the Court held the mixed-motive doctrine would not constitute a complete defense to liability.

This holding has mixed implications for California employers. It limits the damages a plaintiff can recover by taking damages, backpay, and reinstatement orders off the table where a defendant establishes a mixed-motive defense. In that scenario, Courts are under clear mandate to limit Plaintiff’s recovery to declaratory or injunctive relief, and, where appropriate, reasonable attorney’s fees and costs. The outcome of this case may also help curb potentially abusive employment discrimination lawsuits; insofar as mixed-motive plaintiffs will need to jump a little higher to clear the elevated “substantial motivation” hurdle. Potential downsides for employers include inconsistent treatment by the Courts and the risk of being saddled with an opponent’s attorney’s fees.

Unfortunately, it is impossible to predict with any real certainty if, when or how the legislative landscape will change. As California business owners brace for the uncertainty of what’s to come, they can retain some degree of control by using legal developments such as this as instructional tools. Below are some of the practical lessons to be learned from the Harris holding:

  • Take the time to develop employment performance guidelines.
  • Establish and implement a system to enforce those guidelines.
  • Notify employees early and often of the standards they are expected to meet. Give employees enough detail so they know how to succeed and how to avoid failure.
  • Address employees’ offenses and deviations from the employment guidelines in as prompt and comprehensive a manner as indicated by the circumstances.
  • Document each deficiency in enough detail to know what happened, what the investigation revealed, what corrective action was taken and what was communicated by and to the employee; and
  • Enforce guidelines uniformly.

For more information about this topic, please contact one of our business and employment law attorneys at (619) 238.1712.