BILL ANALYSIS AB 2870 Page 1 Date of Hearing: April 21, 2004 ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT Paul Koretz, Chair AB 2870 (Mullin) - As Amended: April 12, 2004 SUBJECT : Employment: commissions. SUMMARY : Makes various changes to the Fair Employment and Housing Act. Specifically, this bill : 1) Eliminates a reference to the now obsolete Fair Employment Practices Commission. 2) Statutorily authorizes the Fair Employment and Housing Commission (Commission) to conduct mediations at the request of the Department of Fair Employment and Housing (DFEH) at any time after a complaint is filed. 3) Changes the title of the Commission's "hearing officers" to "administrative law judges." 4) Makes various amendments, as specified, to provisions of current law related to discrimination on the basis of pregnancy, childbirth or related medical condition. 5) Provides that any money due a respondent by a state agency may be offset to satisfy a final order or decision of the Commission. 6) Specifies that, in the absence of the Commission's own procedural regulations, the commission may rely upon pertinent provisions of the Administrative Procedure Act. 7) Requires a reviewing court, when denying a petition for writ of mandate seeking review of an order or decision of the Commission, to enter judgment denying the petition and enforcing the final order or decision. 8) Specifies that the Commission is not liable for attorney's fees when exercising its adjudicatory functions. 9) Provides guidelines for the determination of civil penalties in housing discrimination cases that parallel existing guidelines for administrative fines in employment cases. AB 2870 Page 2 10)Provides that, in housing discrimination cases where the respondent (such as a real estate broker) is licensed by the state, the Commission shall provide the licensing agency with a copy of any decision or order where it has been determined that an unlawful practice occurred in connection with the exercise of that license. 11)Makes additional technical and conforming changes to existing law. FISCAL EFFECT : Unknown COMMENTS : This bill is sponsored by the Fair Employment and Housing Commission (Commission). The Commission and the Department of Fair Employment and Housing (DFEH) are separate entities in state government, but together are responsible for the enforcement of several California civil rights laws, including the Fair Employment and Housing Act (FEHA), the Unruh Civil Rights Act, and the Ralph Civil Rights Act. FEHA bans employment discrimination on the bases of race, religious creed, color, national origin, ancestry, physical and mental disability, medical condition, marital status, sex, sexual orientation, and age; it also provides job-protected leaves for pregnancy disability and for family and medical reasons. FEHA also bans housing discrimination on the bases of race, color, religion, sex, marital status, national origin, ancestry, familial status, sexual orientation, disability, and source of income. Among its various functions, the Commission conducts hearings and issues decisions in cases prosecuted before it by DFEH. Where an unlawful practice is found, the Commission may order a range of remedies, including back pay, compensatory damages, administrative fines and civil penalties, injunctive relief, and reinstatement. The Commission also promulgates regulations interpreting the laws within its jurisdiction. The Commission also serves as a forum for civil rights issues and provides information and education on the laws it enforces. This bill makes a number of amendments to FEHA, which the Commission states are designed to "clean up" and clarify the law. The Commission states that it has identified provisions in FEHA which are outmoded, unclear or inefficient. Many of these AB 2870 Page 3 changes are technical and nonsubstantive in nature. However, some of the more substantive changes are discussed in detail below: 1. Authorization of Mediation Activities Under current law, the Commission is authorized to conduct hearings in cases that are prosecuted by DFEH. According to the Commission, under current practice it routinely conducts mediations at the parties' request, using hearing officers as mediators in such cases. The Commission states that this bill will codify this current practice and additionally authorize it to mediate a case after a complaint has been filed, if DFEH so asks. 2. Title Change from "Hearing Officer" to "Administrative Law Judge" Current law authorizes the Commission to appoint hearing officer to conduct hearings. This bill would change this designation in the following manner: (1) changing the title of "hearing officer" to "administrative law judge;" (2) authorizing mediation functions as pursuant to the previous amendment; and (3) specifying that the hearing officers of the Commission shall become administrative law judges on the effective date of this bill. According to the Commission, this name change more accurately reflects the duties of current Commission hearing officers. 3. Pregnancy Related Discrimination Currently, FEHA prohibits discrimination on the basis of sex for all employers covered by FEHA (generally those with five or more employees)(Government Code 12940(a)). Current law defines "sex" to include, among other things, pregnancy, childbirth, or medical conditions related to pregnancy or childbirth (Government Code 12926(p). Therefore, FEHA's general prohibition of sex discrimination also prohibits unlawful activity on the basis of pregnancy and related conditions. Federal law, under Title VII of the Civil Rights Act of 1964, contains similar protections against sex discrimination, but only applies to employers with 15 or more employees. AB 2870 Page 4 FEHA also contains a more specific provision containing certain enumerated protections against discrimination on the basis of pregnancy (Government Code 12945). However, the Commission contends that there are numerous inconsistencies, contradictions, and confusion between this provision and the other general sections of FEHA. The Commission contends that this bill will remedy those discrepancies. First, this bill eliminates current Government Code Section 12945(a). The Commission contends that this subdivision is unnecessary because these practices are already forbidden by the general "sex" discrimination provisions of FEHA. Second, this bill eliminates Government Code Section 12945(b)(1). The Commission states that, to the extent that this provision requires employers to treat disabled pregnant employees the same as other non-pregnant disabled employees, this is already covered by the general "sex" discrimination provisions of FEHA. Moreover, the Commission contends that the elimination of subdivision (b)(1) will remedy contradictory distinctions between Title VII employers (15 or more employees) and non-Title VII employers (5 to 14 employees). The Commission contends that this subdivision (when read in conjunction with subdivision (e)) permits non-Title VII employers (5 to 14 employees): (1) to refuse to provide employees with health insurance coverage for the medical costs of pregnancy, childbirth or related medical conditions; (2) to bar pregnant employees from training programs under certain circumstances; and (3) to limit accrued leave for a normal pregnancy to six weeks. The Commission argues that all three of these exceptions contradict the general "sex" discrimination provisions of FEHA, which require that all employers, both Title VII and non-Title VII, treat employees affected by pregnancy, childbirth or related medical conditions the same as other employees in hiring, firing, promotions, training, and in other terms and conditions of employment. In addition, these three exceptions also contradict subdivision (d) which provides that the section " shall not be construed to affect any other provision of law relating to sex discrimination or pregnancy, or in any way to diminish the coverage of pregnancy, childbirth, or medical conditions related to pregnancy or childbirth under any other provisions of this part, including subdivision (a) of Section 12940" (the general FEHA prohibition against "sex" discrimination). AB 2870 Page 5 Third, this bill clarifies language related to the four-month leave afforded to women disabled by pregnancy, childbirth, or related medical conditions. According to the Commission, the proposed language expressly clarifies what has always been implicit and covered in the Commission's regulations - that an employee has a right to return to work after taking pregnancy disability leave. (Title 2 C.C.R. 7291.9). Finally, this bill eliminates extraneous language in Section 12945(c). As this bill eliminates the distinctions between provisions for non-Title VII employers and Title VII employers, the references to "employers subject to and not subject to Title VII of the Federal Civil Rights Act of 1964" are now unnecessary. 4. Monetary Offset Provisions This bill would provide that, in both employment and housing cases, if the Commission imposes liability for actual damages, administrative fine or civil penalty upon a respondent with money due by any state agency, that money may be offset to satisfy the Commission's final order or decision. According to the Commission, these provisions will facilitate enforcement by allowing, for example, liens on money that the state controls (such as state income tax returns) to satisfy Commission monetary awards that are unpaid. 5. Writ of Mandate and Final Judgments Existing law authorizes a respondent to appeal a decision or order of the Commission to the superior court via a petition for writ of mandate. According to the Commission, currently, when a court denies a writ of mandate, the Commission must initiate a separate legal action to order to obtain an entry of judgment denying the petition and enforcing the Commission's final order or decision. According to the Commission, this bill will streamline the enforcement process and save both time and money by requiring the court to automatically enter such a judgment at the time it denies the petition for writ of mandate. 6. Attorney's Fees Provisions This bill contains provisions in both employment and housing AB 2870 Page 6 cases to provide that the Commission is not liable for attorney's fees when exercising its adjudicatory function. 7. Civil Penalty Guidelines in Housing Discrimination Cases Existing law requires the Commission, in assessing administrative fines on employment cases, to find that the respondent has been guilty of oppression, fraud, or malice, express or implied, as required by specified provisions of the Civil Code. Existing law also sets forth factors that the Commission shall consider in determining the amount of such administrative fines. Current law does not, however, provide similar guidance to civil penalties issues in housing discrimination cases. This bill would, therefore, establish the same "oppression, fraud, or malice" requirements for the imposition of civil penalties in housing cases as currently exist for employment cases. In addition, this bill would set forth the same factors for consideration in determining the amount of such penalties. Specifically, the Commission would be required to consider relevant evidence, including, but not limited to the following: (1) willful, intentional, or purposeful conduct; (2) refusal to prevent or eliminate discrimination; (3) conscious disregard for fair housing rights; (4) commission of unlawful conduct; (5) intimidation or harassment; (6) conduct without just cause or excuse; and (7) multiple violations of FEHA. 8. Licensing Notification in Housing Discrimination Cases Current employment discrimination law provides that if the Commission determines that a respondent employer has engaged in unlawful employment discrimination, and the respondent is licensed or granted a privilege by the state to do business or engage in other activities, the Commission must provide a copy of its decision or order to the agency granting the license or privilege. This bill would enact a similar provision to the law regarding housing discrimination. According to the Commission, in housing cases the respondent may be a licensed real estate broker or other housing professional. This bill would require the Commission to report to an appropriate licensing authority that the respondent has violated the housing provisions of FEHA. AB 2870 Page 7 REGISTERED SUPPORT / OPPOSITION : Support California Labor Federation, AFL-CIO Fair Employment and Housing Commission, State of California (sponsor) Opposition None on file. Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091