Employment Laws Affecting You in 2008-2009

This Page Will Place You Ahead in the "Knowledge Game" and Empower You to Make Informed Choices.

• The following summaries are short, simplified statements of the essential holdings in major court decisions.
• Use this information only as a starting point to understand the "lay of the land" and to shape your questions for an attorney.
• More interesting than the case is the question of how you can use the case law itself. A short section follows each summary suggesting tactical implications.

The Essential New Employment Law----Your Right to Access Business Services Free of Bias.

Summary originates from Sheppard & Mullin, (representing employers in employment law disputes, and can be found at: http://www.antitrustlawblog.com ]

In a recent case handed down by the California Supreme Court entitled North Coast Women's Care Medical Group, Inc. v. Superior Court, the Court was asked to decide whether a medical clinic's physicians could discriminate for religious reasons against an individual based on that person's sexual orientation.

In this case, the plaintiff's doctors refused to artificially inseminate the plaintiff. The plaintiff's doctors allegedly claimed that their religious beliefs precluded them from performing the procedure on a homosexual person. Thereafter, the plaintiff sued the doctors and the Clinic alleging that she was unlawfully discriminated against in violation of the Unruh Civil Rights Act (the "Act"). The Act provides certain protected classes the right to equal treatment by businesses which are open to the public. The defendants, however, contended that their constitutional rights to religious freedom and free speech required that they be exempt from state and federal discrimination laws.

The Court rejected the defendants' contention. The Court first held that the Act was a neutral law of general applicability, and, thus, any infringement on the doctors' right to religious freedom caused by adherence to that law was only incidental and constitutional under federal law. The Court also held that the doctors' right to free speech was not infringed upon by the Act, and, thus, the Act was constitutional. In applying state law, the Court held that even applying the most exacting level of scrutiny to the Act, the defendants' contention that they be permitted an exemption from the Act because of their religious beliefs still failed. In so holding, the Court stated that the doctors had two choices under the law that were consistent with their religious beliefs: (1) perform the procedure for no individuals or (2) ensure that there is at least one other doctor employed by the Clinic to perform the procedure who does not share their religious objection.

This is an important case for California employers because it reinforces not only the fact that employers are potentially liable for the conduct of their employees, but also that employers are responsible for ensuring that its employees are complying with discrimination laws with respect to their customers. This case demonstrates that not even an individual's right to religious freedom will exempt an employer or its employees from state discrimination laws.

How You and Your Attorney Can Use this Information

You have the right to receive medical services for fertility treatments without discrimination because of sexual orientation, or because the individual physician may have an objection to fertility treatments because of relgious preference. The court is clear: the individual doctor either must treat all persons equally, or cease providing the particular medical procedure.

The Essential New Employment Law----Your Right to Compete After Leaving Your Employment.

Generally, California employees resuming work in California are free to compete with their employers in California after leaving their employment. Nearly all my clients seem to understand this basic law when they arrive for their first consultation. Agreements signed by employees that purport to be "non-compete" agreements have been declared illegal and unenforceable by numerous California court decisions. So what's new?

A 2008 California Supreme Court case further expands the protection. The Court held, in Edwards v. Arthur Andersen LLP, that a non-compete provision that was limited to non-competition by restricting contact of clients served by the employee in the 18 months pre-termination was unenforceable. The employer's effort to limit the scope of the non-competition in time or categories of people/clients will not be recognized as an exception to the rule of free competition.

How You and Your Attorney Can Use this Information

What if you're asked to sign these agreements as a condition of employment, or what if you're already hired, but told you must sign such an agreement to retain your employment? Sign if you like, because the agreement is unenforceable. Or refuse to sign, and if the only reason for non-hire or termination of employment was your refusal, you could bring a "wrongful termination (or denial of employment) in violation of public policy" case resulting in damages for lost wages, emotional injury, and possibly punitive damages.

I have seen recent agreements that attempt to use softer language to accomplish some of the same unenforceable objectives of limiting competition. If you're not sure of the enforceability, and you want to avoid the potential cost and aggravation of fighting an employer petition for preliminary injunction, use your attorney to write a letter to your former employer that the agreement is an illegal restraint of free competition, and that you will seek damages if the former employer attempts to interfere with your current employment. [i.e., an action for negligent and intentional interference with existing economic advantage and/or existing contractual relations]. You may also have a case for defamation if your old employer accuses you of unethical conduct in violating the unenforceable agreement.

The Essential New Employment Law----Your Wrongful Termination Case Could Be Covered by Employer Insurance.

In the last 10 years, there has been a new insurance product added to the business insurance portfolio, the Employment Practices Liability Policy, also called "EPL" insurance. This coverage includes a legal defense of discrimination and whistlebower retaliation cases.

What if the Employer or its defense attorney get a demand letter or notice of a CA Dept. of Fair Employment and Housing Complaint (D.F.E.H. filing), but fail to pass that information along to the company's EPL carrier. The employer/insured can be deemed to have failed to comply with a contractual provision of the policy requiring prompt notice of claims, with the result that the insured employer will have been deemed to have forfeited (waived) the right to coverage and a legal defense.

The Second Circuit in Westrec Marina Management v. Arrowood Indemnity Co. held that such a delay in an employment law case in notifying the company's carrier of the claims stated in a demand letter can be just such a waiver of insurance coverage. The holding is a warning to employers to report potential claims to their insurance carrier as soon as possible or face denial of coverage. In Westrec, an employee filed a charge of discrimination against Westrec with the California Department of Fair Employment and Housing (DFEH) and requested an immediate right to sue letter. Subsequently, her attorney sent a demand letter to Westrec asserting claims and seeking possible early settlement prior to filing a lawsuit. At the time of the letter, Westrec failed to inform its insurer, Arrowood, of the claim. The employee later filed a civil action, and when Westrec tendered the claim, Arrowood denied coverage.

Arrowood argued that both the DFEH charge and the demand letter were "claims" under its policy, and Westrec's failure to tender them voided coverage for the later lawsuit. Westrec argued that neither the DFEH charge nor the attorney's letter were "claims" and it had no responsibility to tender under the policy until the lawsuit was filed. The court sided with Arrowood. It held that the attorney's letter was a "claim" because it clearly expressed the intent to sue Westrec if a settlement was not reached. The court did not expressly hold that the mere filing of a DFEH charge or receipt of a right to sue letter were a "claim" triggering the obligation to tender. However, it did note that "[o]btaining a right to sue notice is a necessary predicate to the filing of an action under the California Fair Employment and Housing Act." Therefore, Westrec should have tendered the claim immediately upon receipt of the right to sue notice. The case serves as a stark reminder to employers that they should notify their insurer of any claim or potential claim as soon as possible to avoid losing coverage.

How You and Your Attorney Can Use this Information

Your attorney should remind the employer and its counsel of the risks associated with delay in notifying an EPL carrier of the claims rpesented, inlcuding informal, pre-litigation claims and threats of suit. The result is good for all concerned. Your case has a better chance of being fully compensated if insurance is available, and the employer saves its capital for operations as opposed ot litigation.

The Essential New Employment Law --- Federal Judges Showing a "Statistical" Bias Against Discrimination Plaintiffs.

[THIS SUMMARY IS EXCERPTED FROM AN EMAIL DATED 10/02/08 FROM MEDIATOR ROBERT COVIELLO, ESQ. [ADR SERVICES, INC.].

Newly analyzed data from federal court records show that workers bringing employment discrimination lawsuits increasingly fare poorly in the federal courts, according to a report to be published by the Harvard Law & Policy Review and released September 18, 2008, by the American Constitution Society for Law and Policy (ACS).
Studying data from the Administrative Office of the United States Courts, authors Stewart J. Schwab, dean of the Cornell Law School, and Kevin M. Clermont, law professor at the Cornell Law School, find that "the federal courts disfavor employment discrimination plaintiffs, who are now forswearing use of those courts." The authors conclude that they have "unearthed an anti-plaintiff effect that is troublesome."

The findings of the study will also be a subject of a Senate Judiciary Committee hearing on the federal courts scheduled for next Tuesday, September 23, 2008. Cyrus Mehri, of the law firm Mehri & Skalet, will testify about the details of the study alongside Lilly Ledbetter, the plaintiff in the recent 5-4 Supreme Court decision Ledbetter v. Goodyear Tire, whose equal pay claim was turned aside by the high court.

Highlights from the study, "Employment Discrimination Plaintiffs In Federal Court: From Bad To Worse?" include:

ââ'¬Ã'¢ As a result of the likelihood of unfavorable rulings in employment discrimination cases, more employees are declining to bring actions in federal court. Over seven years, 1999-2007, there has been a drop of 37 percent in the number of cases brought by plaintiffs.
ââ'¬Ã'¢ Employment cases fare much worse than other types of cases that are filed. Between 1979 and 2006, the win rate for plaintiffs in job discrimination cases in the federal court system was 15 percent, in contrast to 51 percent for non-job related cases.
ââ'¬Ã'¢ Employment discrimination plaintiffs are not likely to experience any greater success at the appeals court level. Data reveal that plaintiffs who lose at trial achieve reversals in less than nine percent of their cases. In contrast, defendants who lose at the trial court level are granted reversals in 41 percent of their cases.

How You and Your Attorney Can Use this Information

Some theories of law used to recover damages, if pleaded and filed in State Court, may result in the State Court Complaint being "removed" to federal court. These formally pleaded "Causes of Action" may be explicitly stated by statute to required federal court jurisdiction. Likewise, if all the defendants in a case reside in a state other than the Plaintiff's place of residence, and if the matter involveds a controversy greater than $80,000, the case may be removed to Federal Court based on "diversity of citizenship".

Therefore, you and your attorney may want to conduct a "cost-benefit" analysis of whether it is wise to file "causes of action" that invoke federal court jurisidiction. For example, the CA Fair Employment and Housing Act [F.E.H.A.] provides virtually all the remedies of the federal Title VII anti-discrimination statutes. Tactiically, it would make no sense to file a Title VII case if F.E.H.A. is available, and the State Courts would provide a more favorable forum.

The Essential New Employment Law --- Federal A.D.A. Law Amended to Increase Rights of Disabled.

ARTICLE: http://www.hrtools.com/news/alerts/president_signs_ada_amendments_act_of_2008_into_law.aspx

With his father standing by him, President George W. Bush signed the ADA Amendments Act of 2008 into law on September 25, 2008 in the Oval Office. The ADA Amendments Act amends the Americans with Disabilities Act, which was signed by President George H.W. Bush in 1990. The ADA is the nationââ'¬â"¢s first comprehensive civil rights law prohibiting discrimination against individuals with disabilities in employment, public services, public accommodations and telecommunications, by restoring the ADAââ'¬â"¢s original intent and protections. The ADAAA states that the definition of disability should be construed in favor of broad coverage of individuals under the ADA, to the maximum extent permitted by the terms of the ADA. While the ADAAA retains the ADAââ'¬â"¢s existing definition of ââ'¬Å"disability,ââ'¬ the ADAAA amends the ADA to further define and clarify three critical terms within the existing definition (ââ'¬Å"substantially limits,ââ'¬ ââ'¬Å"major life activities,ââ'¬ and ââ'¬Å"regarded asââ'¬ having such impairment) and, under the rules of construction for the definition, adds several standards that must be applied when considering the definition of ââ'¬Å"disability.ââ'¬ In particular, the law rejects US Supreme Court precedent holding that the terms ââ'¬Å"substantiallyââ'¬ and ââ'¬Å"majorââ'¬ in the definition of disability must be ââ'¬Å"be interpreted strictly to create a demanding standard for qualifying as disabled,ââ'¬ as well as the Courtââ'¬â"¢s interpretation that ââ'¬Å"substantially limitsââ'¬ means ââ'¬Å"prevents or severely restricts.ââ'¬ Instead, the bill reiterates that whether an individualââ'¬â"¢s activities are limited in condition, duration and manner, is a useful test.

For the first time, the ADAAA also directly places in the ADA itself a non-exhaustive list of major life activities, including caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, and working. The law also expands the category of major life activities to include the operation of major bodily functions. The ADAAA also removes from the ââ'¬Å"regarded asââ'¬ prong of the disability definition the requirement that an individual demonstrate that he or she has, or is perceived to have, an impairment that substantially limits a major life activity. Under the ADAAA, individuals can establish they are ââ'¬Å"regarded asââ'¬ disabled by showing that they have been subjected to adverse action under the ADA because of an actual or perceived physical or mental impairment. The definition is subject to two important limitations. First, individuals with impairments that are transitory and minor are excluded from eligibility for the protections of the ADA under the ââ'¬Å"regarded asââ'¬ prong, and second, the ADAAA relieves entities covered under the ADA from the obligation and responsibility to provide reasonable accommodations and reasonable modifications to those who qualify for coverage under the ADA solely by being ââ'¬Å"regarded asââ'¬ disabled. The law also prohibits consideration of mitigating measures such as medication, assistive technology, accommodations, or modifications when determining if an impairment constitutes a disability. Ordinary eyeglasses and contact lenses are excluded from this prohibition, however employers may not screen out people with ordinary eyeglasses and contact lenses unless there is a business necessity. The law also adds language for the education community, reiterating the current statutory exception that academic institutions, including postsecondary education institutions, are not required to make reasonable modifications to their policies, practices or procedures that fundamentally alter the nature of their programs or when the academic requirements are essential to a program of study or to meet licensing prerequisites.

The ADAAA takes effect January 1, 2009. The Equal Employment Opportunity Commission is tasked with revising its regulations relating to changes made by the Act.

How You and Your Attorney Can Use this Information

These federal amendments have been anticipated for nearly 10 years in California in its separately enacted disability discrimination and accommodation laws that are much more favorabl to the employee. The new federal A.D.A. amendments remove a hurdle to proving a "disablity", i.e., that the disability exists despite the presence of "mitigating" measures, such as medications or implants, or glasses. The "listing" of kinds of impairments may result in a relaxed definition of "disability" as well, by directing federal judges to interpret the terms favorably to the employee. The amendments specifically seek to reverse a U.S. Supreme Court decision that required the term "disability" to be defined strictly and in effect, unfavorably to the employee.

While this is a definite advance in employee disability rights, it does NOT give reason to Californa attorneys using the CA Fair Employment and Housing Act [F.E.H.A.] to discontinue their preference in filing cases under State law, with the attendant advantages of having the case in State Court.

Employee Rights Attorney Frank Pray

5160 Campus Drive

Newport Beach CA 92660

949.251.1006

877.job.atty

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