In a recent Webinar I did with DFEH head Phyllis Cheng she shared this graph of claims filed in California in 2011. And it got me to thinking. It made me want to ask… just how bad is that?
There are roughly 16 million workers in California. In 2011 roughly 18,000 cases were filed with the DFEH (the new 2012 numbers will be closer to 21,000 but as of this writing were not published yet). Let’s assume that is one half the claims universe since claims like overtime, wrongful termination and the like don’t need to involve the DFEH. So… 16,000,000 divided by 42,000 gets you one claim per year, of some kind, per 380 employees. Many of the DFEH and other claims are dismissed as without merit. The really good cases get pulled out of the DFEH system and dragged into court. Employees win more than half the cases that go to trial with the average jury verdict hovering around $250,000, the average settlement around $75,000. And that doesn’t include attorney’s fees. Of course you can–and should–insure against these claims so that your exposure does not exceed your deductible limit of, say, $25,000. The cost of that insurance is approximately $150 per year per employee, which comes out to a $57,000 annual premium. Keeping on one poor manager you are afraid to fire due to a potential lawsuit will more than eat up that premium cost.
Note: The EEOC claims some 100,000 discrimination claims were filed with it in 2012.
While getting the stats for work comp claims was more difficult, what I could find indicated there roughly 780,000 workers’ compensation claims filed each year in California. Most claims (around two-thirds) are for medical care only, with no cash indemnity payments. Approximately 20 percent of claims are for temporary disabilities. Permanent partial disability claims account for about 14 percent of total claims – 10 percent are minor disabilities and four percent are major disabilities. Death benefits and permanent total disability benefits each account for about one-half of one percent of total workers’ compensation claims. According to the rating bureau, the average lost work claim cost roughly $68,000 (and there were roughly 260,000 of them.) Of course these claims are always insured and in 2010, employers paid an average of $2.37 per $100 of payroll for policies.
Bottom line with risk management is to analyze, mitigate, and insure against it where possible.
The Department of Fair Employment and Housing recently began enforcing newly revised regulations addressing discrimination based on disability. The final regulations, which took effect on December 30, 2012, primarily update the old regulations. Among other things, the new regulations:
- include several updates to the definition of “disability” to conform to the federal Americans with Disabilities Act Amendments Act of 2008 and the broad definition contained in Government Code section 12926.1;
- provide examples of disabilities including chronic and episodic conditions, and temporary disabilities. The new regulations note a few exclusions from the term “disability,” such as the common cold, mild cuts or abrasions, and the flu;
- clarify that the term “medical condition” may include a “genetic characteristic” (in order to conform to the federal Genetic Information Non-Discrimination Act);
- add guidance regarding the phrase “essential job functions,” and specify that the elements of a discrimination claim now require the employee to establish that he or she can perform the job’s essential functions, with or without accommodation;
- provide more detail regarding the “interactive process” obligations for both employers and employees. Notably, an employee’s exhaustion of California Family Rights Act or Family and Medical Leave Act leave is now considered notice to the employer that the employee may need an accommodation; and
- recognize medical leave as a form of accommodation, but expressly state that employers need not provide “indefinite” leave.
Article courtesy of Thomas Ingrassia of Petit Kohn (www.pettitkohn.com)
AB 1844 (Passed): This bill would prohibit an employer from requiring or requesting that an employee or applicant disclose user name or password information for personal social media, or to divulge any personal social media.
Chapter 2.5. Employer Use of Social Media
980. (a) As used in this chapter, “social media” means an electronic service or account, or electronic content, including, but not limited to, videos, still photographs, blogs, video blogs, podcasts, instant and text messages, email, online services or accounts, or Internet Web site profiles or locations.
(b) An employer shall not require or request an employee or applicant for employment to do any of the following:
(1) Disclose a username or password for the purpose of accessing personal social media.
(2) Access personal social media in the presence of the employer.
(3) Divulge any personal social media, except as provided in subdivision (c).
(c) Nothing in this section shall affect an employer’s existing rights and obligations to request an employee to divulge personal social media reasonably believed to be relevant to an investigation of allegations of employee misconduct or employee violation of applicable laws and regulations, provided that the social media is used solely for purposes of that investigation or a related proceeding.
(d) Nothing in this section precludes an employer from requiring or requesting an employee to disclose a username, password, or other method for the purpose of accessing an employer-issued electronic device.
(e) An employer shall not discharge, discipline, threaten to discharge or discipline, or otherwise retaliate against an employee or applicant for not complying with a request or demand by the employer that violates this section. However, this section does not prohibit an employer from terminating or otherwise taking an adverse action against an employee or applicant if otherwise permitted by law.
SB 1255 (Signed): This bill would specify circumstances under which “injury” would be presumed to an employee as a result of an employer not providing wage statements, or providing incomplete wage statements. Presumed injury would allow the employee to recover penalties and/or actual damage. Presumed injury could be shown by the failure to provide a wage statement at all, or by the failure to include the employee’s name and last 4 digits of the social security number. It could also be shown by failing to provide complete wage information, causing the employee to be unable to determine (from the statement alone) gross and net wages earned, deductions therefrom, and the name and address of the employer.
“An employee suffering injury as a result of a knowing and intentional failure by an employer to comply with subdivision (a) is entitled to recover the greater of all actual damages or fifty dollars ($50) for the initial pay period in which a violation occurs and one hundred dollars ($100) per employee for each violation in a subsequent pay period, not to exceed an aggregate penalty of four thousand dollars ($4,000), and is entitled to an award of costs and reasonable attorney’s fees.
AB 1744 (Signed, effective July 1, 2013): This bill would require temporary services employers to include additional information on itemized wage statements for employees, including the rate of pay for each assignment, the name and address of the entity that secured the services and total hours worked for each entity.
AB 2103 (Signed): Payment of a fixed salary to a nonexempt employee shall be deemed to provide compensation only for the employee’s regular, non-overtime hours, notwithstanding any private agreement to the contrary.
AB 2674 (Signed): This bill would amend section 1198.5 of the Labor Code relating to employee rights to inspect personnel files. The bill would require employers to maintain employee personnel files for at least 3 years following termination of employment, and to permit current and former employees (or their designated representatives) to inspect and copy personnel records, within 30 days of a request to do so by the employee. The bill specifies that an employer is not required to comply with more than 50 requests for copies of personnel records by a representative of employee(s) in one calendar month.
And of course, HR That Works!
ELK GROVE, CA — The California Department of Fair Employment and Housing (DFEH) announced today that United Parcel Service (UPS) must pay more than $96,000 in damages after the company fired employee Eva Linda Mason because of her disability. The Fair Employment and Housing Commission (Commission) found that UPS had unlawfully terminated Ms. Mason even though she could perform the essential functions of her job.
UPS hired Ms. Mason in 1997 primarily as an Operations Management Specialist to handle customer calls and complaints on shipments. Although she occasionally located packages in a warehouse, handling packages was not part of her job. After Ms. Mason had knee surgery and took a leave of absence to recover in 2007, she continued to carry out the essential customer service functions of her job. Nonetheless, UPS perceived Ms. Mason as disabled because she had some restrictions, such as limited standing, walking, bending, and kneeling. UPS had a 12-month cap on the length of time employees with disabilities could be reasonably accommodated from their regular duties. UPS applied this cap to Ms. Mason and fired her in August 2008.
“Using a 12-month cap to fire disabled employees is unlawful under the Fair Employment and Housing Act (FEHA),” said the Department of Fair Employment and Housing Director Phyllis Cheng. “Employees with disabilities must be allowed to work if they can perform their essential job duties with or without accommodation.”
The Commission ordered UPS to pay $96,170 in damages, including $10,000 in administrative fines to the State. UPS must also post a notice about its liability and develop a policy and train management on disability discrimination.
State Orders Air Canada to Pay over $325,000 for Refusing to Accommodate Customer Service Agent’s Disability
ELK GROVE, CA — The California Department of Fair Employment and Housing (DFEH) announced today that Air Canada must pay more than $325,000 in damages after the company fired one of its customer service representatives because of her disability. The Fair Employment and Housing Commission (Commission) found that Air Canada failed to accommodate the employee’s disability and then fired her because she could not lift cargo – a job function customer service representatives rarely perform.
“Employers must attempt to find reasonable modifications that allow employees with disabilities to keep working,” said the Department of Fair Employment and Housing Director Phyllis Cheng. “Using non-essential job functions as a pretext to deny employment to persons with disabilities is unlawful in California.”
The employee, Caroline Messih Zemaitis, worked as a customer service agent for Air Canada at Los Angeles International Airport from 1993 to 2007. Starting in 2004, she held a clerical position in the cargo division that did not involve physical labor. In 2005 and 2006, Ms. Zemaitis injured her back, shoulder, knee and wrist, and her doctor restricted her from performing such tasks as heavy lifting and repeated bending. She was able to keep working in the cargo division with minor accommodations such as Air Canada’s provision of a telephone headset and heating pad, and time off for physical therapy.
When Ms. Zemaitis became pregnant, her back condition worsened and she took a medical leave of absence for about a year. She tried to return to work in 2007 when her doctor released her with restrictions similar to those she had before, but Air Canada refused to respond to her many communications. Instead, Air Canada terminated Ms. Zemaitis’s because she could not lift cargo, a job function the airline’s customer service agents rarely perform.
The Commission found during this precedential decision that Air Canada had violated the Fair Employment and Housing Act. It ordered them to pay Ms. Zemaitis $102,737 in back pay, $19,720 in lost benefits, and $125,000 for emotional distress. Air Canada must further reinstate and pay Ms. Zemaitis $54,784 in wages plus interest and pay the State a $25,000 administrative fine. The airline will also have to post a notice about their liability and develop a policy and train management on reasonable accommodations necessary to allow disabled employees to continue working.
The California Department of Fair Employment and Housing (DFEH) today announced its largest-ever administrative award of $846,300 against electrical supplier Acme Electric Corporation for firing an employee because he had cancer. Headquartered in Lumberton, North Carolina, Acme Electric is a division of Actuant Corporation, a Wisconsin diversified industrial corporation that operates in more than 30 countries.
Charles Richard Wideman worked for Acme Electric as western regional sales manager overseeing sales operations in the company’s largest territory from February 2004 to March 2008. He developed kidney cancer in 2006 and prostate cancer in 2007. Mr. Wideman’s cancers required two surgeries and numerous cancer-related outpatient appointments. The company immediately granted his two requests for time off for surgery and recuperative leave. However, Mr. Wideman requested further accommodation for the travel limitation his cancers caused from June 2006 through April 2007. Acme Electric refused to grant or even acknowledge these accommodation requests. Instead, in December 2007, Mr. Wideman’s supervisor gave him an unfavorable performance evaluation, criticizing him for insufficient travel. On February 28, 2008, ignoring Mr. Wideman’s need for accommodation the preceding year and failing to take into account his dramatically improved job performance, Acme Electric fired Mr. Wideman, relying on the insufficient travel pretext.
After a three-day hearing, the State’s Fair Employment and Housing Commission found Acme Electric violated the FEHA by failing to accommodate Mr. Wideman’s known travel limitation due to his cancers, failing to engage in a good faith interactive process, discriminating against Mr. Wideman because of his disability, and failing to take all reasonable steps necessary to prevent discrimination from occurring. To compensate Mr. Wideman for his losses, the Commission awarded him $748,571 for lost wages, $22,729 for out-of-pocket expenses and $50,000 for the emotional distress he suffered. In addition, the Commission ordered Acme to pay $25,000 to the State’s General Fund as an administrative fine. Acme must further comply with posting, policy changes, and training requirements ordered by the Commission.
Employer lesson: You can’t ignore ADA restrictions simply because it’s a pain to comply with. Any employee with a disability has to perform, with or without accommodations. In this case, had ACME attempted to accommodate Mr. Wideman…and he still could not perform to standard, then there is no liability. To learn about accommodating employees with cancer go to http://askjan.org/media/canc.htm
ELK GROVE, CA — The California Department of Fair Employment and Housing (DFEH) today announced the $70,000 settlement of a workplace sexual orientation harassment case against Limited Brands Store Operations, Inc., and Bath & Body Works, LLC. A manager of a Bath & Body Works was accused of harassing her co-manager because of his sexual orientation.
The DFEH filed an accusation with the Fair Employment and Housing Commission after investigating a complaint from the co-manager, who began working at Bath & Body Works in August 2007. The complainant claimed that from his first day on the job, his female supervisor referred to him multiple times a day using slurs based on his sexual orientation, drew pictures of male genitals, which she hung in the store’s back room, told his co-workers that he liked kissing boys, and falsely claimed that his attitude was affecting the work environment. The Department’s accusation further alleged that, although another store manager witnessed the harassment and the employee complained to the district manager, Bath & Body Works failed to stop the harassment, ultimately forcing the complainant to quit.
“The Department of Fair Employment and Housing takes great pride in leading the enforcement of California’s civil rights laws,” said DFEH Director Phyllis Cheng. “This compelling case should remind employers that they must have policies in place to prohibit discrimination and harassment against employees—and employ managers who can enforce those policies.”
As part of the $70,000 settlement, Bath & Body Works, LLC agreed to provide discrimination and harassment prevention training to its supervisors and managers, provide training to all new hires within 60 business days of hire, display posters informing employees of their right to report discrimination to the DFEH, and retain copies of all complaints of discrimination and harassment made by employees alleging a violation of the Fair Employment and Housing Act. Bath & Body Works did not admit to any liability in the agreement to settle.
Preliminary statistics from 2010 shows that during a year of three-day furloughs, hiring freezes and budget cuts, the DFEH increased its 2010 settlements from its typical $7-9 million to over $11 million. The success is due to the implementation of the Department’s Case Grading System, the settlement of the four group/class actions (not including Verizon), the establishment of a new Mediation Division, and ongoing prosecution and settlement by the Legal Division.
I just received this ruling from California that while in a housing discrimination case would equally apply to an employment one.
Dept. of Fair Emp. & Housing v. Mayr (CA6 H034935 2/9/11) DFEH/Litigation Costs and Fees
After a jury found in favor of the defendants in this housing discrimination action [insert employment discrimination action], the trial court ordered the plaintiff, the Department of Fair Employment and Housing, to pay the costs and attorney fees of the defendants, the owner of rental property and her property manager. DFEH appeals, contending that the court erroneously applied Code of Civil Procedure section 1028.5 as a sanction for pursuing a meritless action notwithstanding Government Code section 12989.2, which bars awards of litigation costs and fees either to or against a government agency in a housing discrimination action. We agree with DFEH that the latter statute governed the availability of costs and attorney fees in this case. We therefore must reverse the order.
What this means is this: the DFEH can pursue frivolous claims and meritless claims…and you can’t do anything about it. As an interesting side note, the lead counsel for DFEH was Jerry Brown.
You may have similar “immunity” statutes in your state. And of course, the Feds are immune:
Under the doctrine of sovereign immunity, the United States is immune from suit and may define the conditions under which it will permit actions against itself . . . . Waivers of sovereign immunity must be “unequivocally expressed” in “statutory text,” . . . , and “[waivers] are not to be implied.” Uberoi v. EEOC, 180 F. Supp. 2d 42 (D.D.C. 2001) Courts have held that “claims for money damage against the EEOC are barred by sovereign immunity,” Clissuras v. EEOC, 1990 WL 96754, *4 (S.D.N.Y.1990); see also McCartin v. Norton, 674 F.2d 1317, 1321-22 (9th Cir.1982)