BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 655| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- UNFINISHED BUSINSES Bill No: SB 655 Author: Wright (D) Amended: 9/6/13 Vote: 21 SENATE JUDICIARY COMMITTEE : 5-1, 4/23/13 AYES: Evans, Corbett, Jackson, Leno, Monning NOES: Anderson NO VOTE RECORDED: Walters SENATE FLOOR : 21-13, 5/30/13 AYES: Beall, Block, Corbett, De León, DeSaulnier, Evans, Hancock, Hernandez, Hill, Jackson, Lara, Leno, Lieu, Liu, Monning, Padilla, Pavley, Price, Steinberg, Wright, Yee NOES: Anderson, Berryhill, Cannella, Correa, Emmerson, Fuller, Gaines, Huff, Knight, Nielsen, Roth, Walters, Wyland NO VOTE RECORDED: Calderon, Galgiani, Hueso, Torres, Wolk, Vacancy ASSEMBLY FLOOR : Not available SUBJECT : Fair Employment and Housing Act: unlawful practices SOURCE : AARP California California Employment Lawyers Association DIGEST : This bill provides that, in a claim of discrimination or retaliation under its provisions, the person claiming to have been aggrieved will prevail if he/she has proven that a protected characteristic or activity was a substantial CONTINUED SB 655 Page 2 motivating factor, as defined, in the employment action or decision. If an employer pleads and proves that it would have made the same employment action or decision at the same time, without considering the protected characteristic or activity, the remedies available to the employee would be limited as specified. If an employer fails to prove that it would have made the same employment action or decision at the same time without considering the protected characteristic or activity, this bill authorizes noneconomic damages, injunctive relief, and attorney's and expert's fees against the employer and would require a specified civil penalty to be paid by that employer to the employee. Assembly Amendments change the term "substantial factor," to "substantial motivating factor," and reduce specified penalties paid to employees from $25,000 to $15,000 and make other clarifying and conforming changes. ANALYSIS : Existing law, under the California Fair Employment and Housing Act, protects and safeguards the right and opportunity of all persons to seek, obtain, and hold employment, participate in a labor organization, and participate in employment training or apprenticeship programs without discrimination or abridgment on account of 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. Existing law also authorizes a person claiming to be aggrieved by an alleged unlawful practice under these provisions to file a complaint with the Department of Fair Employment and Housing and authorizes the Department to bring a civil action on the behalf of the person in the case of a failure to eliminate an unlawful practice under these provisions. This bill: 1. Provides that for purposes of a claim of discrimination or retaliation under provisions of this bill, the person claiming to be aggrieved will prevail if he/she has proven to the trier of fact that the protected characteristic or activity was a substantial motivating factor in the employment action or decision. CONTINUED SB 655 Page 3 2. Defines "substantial motivating factor" to mean a factor that actually contributed to the employment action or decision. It must be more than a remote or trivial factor, but need not be the only or main cause of the employment action or decision. Evidence that the person claiming to be aggrieved had a protected characteristic at the time of the employment action or decision is not, by itself, sufficient proof that the protected characteristic was a substantial motivating factor. 3. Specifies that if an employer pleads and proves that it would have made the same employment action or decision at the same time without considering the protected characteristic or activity, the employee will not be entitled to reinstatement, back pay, or declaratory relief. 4. Provides that in a civil action brought pursuant to provisions this bill, if an individual proves a claim of discrimination or retaliation, but an employer pleads and proves that it would have made the same employment action or decision at the same time without considering the protected characteristic or activity, the employee shall not be entitled to reinstatement, back pay, compensatory damages, or declaratory relief. The employee may recover injunctive relief and attorney's fees and costs, including expert witness fees. The court shall also grant a statutory penalty of up to $25,000 to be awarded directly to the employee. 5. Provides that any relief a court is empowered to grant in a civil action brought pursuant to provisions of this bill, in addition to any other relief that, in the judgment of the court, may include a requirement that the employer conduct training for all employees, supervisors, and management on the requirements of this part, the rights and remedies of those who allege a violation of this part, and the employer's internal grievance procedures. In addition, in order to vindicate the purposes and policies of this part, a court may assess against the defendant, if the civil complaint or amended civil complaint so prays, a civil penalty of up to $25,000 to be awarded to a person denied any right provided the Civil Code, as an unlawful practice prohibited, as specified. Background CONTINUED SB 655 Page 4 Existing law, FEHA, prohibits discrimination in housing and employment because of 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 (protected characteristics). In FEHA cases, parties are subject to a three-stage burden-shifting test, commonly referred to as the McDonnell Douglas test, which begins with the burden on the plaintiff to prove it is more likely than not that the employer took an adverse employment action based on a prohibited characteristic. (See McDonnell Douglas Corp. v. Green (1973) 411 U.S. 792; Guz v. Bechtel National Inc. (2000) 24 Cal.4th 317, 354-356.) The McDonnell Douglas test presupposes that there is only one reason for an employer to have taken an adverse employment action against an employee. However, in cases where a court finds that an employer had mixed motives (both discriminatory and nondiscriminatory reasons) for the adverse employment action, courts have struggled to determine what level of causation is required for a court to find that the discriminatory motives were the main reason for the adverse employment action. Recently, the California Supreme Court faced this challenge in Harris v. City of Santa Monica (2013) 56 Cal.4th 203, and held that, in order for a plaintiff to prevail on a mixed-motive FEHA case, the plaintiff must prove that the discriminatory motive was the substantial factor in the defendant's adverse employment decision. This bill codifies the court's holding in the Harris case, as well as provides a definition of "substantial factor." FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local: No SUPPORT : (Verified 9/10/13) AARP California (co-source) California Employment Lawyers Association (co-source) AFSCME Asian Pacific American Legal Center California Labor Federation CONTINUED SB 655 Page 5 California NAACP California Professional Firefighters California School Employees Association Church State Council Congress of Racial Equality of California Consumer Attorneys of California Disability Rights Education and Defense Fund Disability Rights Legal Center Equal Rights Advocates Equality California Greater Sacramento Urban League Lawyers' Committee for Civil Rights of the San Francisco Bay Area Legal Aid Society - Employment Law Center Mexican American Legal Defense and Education Fund National Center for Lesbian Rights SEIU Transgender Law Center Women's Employment Rights Clinic of Golden Gate University School of Law OPPOSITION : (Verified 9/10/13) Greater Fresno Chamber of Commerce Porterville Chamber of Commerce ARGUMENTS IN SUPPORT : According to the author's office, this bill follows the court's ruling in Harris v. City of Santa Monica (2013) 56 Cal.4th 203 by recognizing and addressing mixed motive discriminatory practices in the workplace and provides clarity and guidance for the "substantial factor" standard that was adopted, but left undefined by the court. This bill codifies the definition of "substantial factor" consistent with the California Supreme Court's previous decisions interpreting this phrase (See Bockrath v. Aldrich Chemical Co., Inc. (1999) 21 Cal.4th 71, Rutherford v. Owens-Illinois, Inc. (1997) 16 Cal.4th 953). This bill will also restore FEHA's prescriptive function to provide effective remedies for redressing, preventing, and deterring unlawful discrimination. By establishing a civil penalty of $25,000 for discrimination that is proven to be a "substantial factor" in an adverse employment action and by providing non-economic relief for the aggrieved worker, this CONTINUED SB 655 Page 6 bill strikes the right balance in preventing and deterring unlawful employment practices and redressing their adverse effects. ARGUMENTS IN OPPOSITION : An opposition coalition asserts that the Harris court held that "for there to be a valid discrimination claim, the employee must prove the discriminatory intent was a substantial motiving factors for the employer's decision. SB 655 undermines this unanimous decision by re-defining the term 'substantial factor' to mean discriminatory intent that is more than just 'trivial or remote,' but eliminates the need for the discriminatory intent to be the 'motivating' factor. While this definition tracks jury instructions used in negligence cases where juries evaluate a person's conduct to determine if it was the 'substantial factor' of the injury, it fails to recognize case law defining that term." Opponents point to the court's discussion in Mayes v. Bryan (2006) 139 Cal.App.4th 1075, regarding the use of a civil jury instruction defining "substantial factor." Opponents note that the Mayes court "agreed that this term means the act is 'a factor that a reasonable person would consider to have contributed to the harm. It must be more than a remote or trivial factor. It does not have to be the only cause of the harm. Conduct is not a substantial factor in causing the harm if the same harm would have occurred without that conduct." (Emphasis in original.) Opponents further assert that this bill will expose employers "to liability and statutory damages of at least $25,000, even when discriminatory intent was not the substantial factor that led to the employer's decision and the employment decision would have still occurred regardless of the discriminatory intent or bias." AL:k 9/11/13 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED SB 655 Page 7 CONTINUED