BILL ANALYSIS
SENATE JUDICIARY COMMITTEE
Martha M. Escutia, Chair
2003-2004 Regular Session
AB 76 A
Assembly Member Corbett B
As Amended June 19, 2003
Hearing Date: June 24, 2003 7
Government Code 6
GMO:cjt
SUBJECT
Employment Discrimination
DESCRIPTION
This bill would amend the Fair Employment and Housing Act
(FEHA) to prohibit harassment of an employee in the
workplace by a person other than an employee, agent, or
supervisor of the employer. The bill is intended to
invalidate the appellate court's rulings in Salazar v.
Diversified Paratransit, Inc. , which held that the FEHA
does not impose employer liability for harassment of an
employee in the workplace by a client, customer or other
third party.
BACKGROUND
FEHA was amended in 1984 to prohibit harassment in the
workplace (SB 2012, Watson, Chapter 1754, Statutes of
1984). The anti-harassment provision makes an employer
liable for harassment of an employee or other covered
individual by an employee other than an agent or supervisor
if the employer knew or should have known of the conduct
and failed to take immediate and appropriate corrective
action. Another provision requires employers to "take all
reasonable steps to prevent harassment from occurring."
For almost two decades, this statute has been implemented
in the state by the Department of Fair Employment and
Housing through regulations and directives, providing
guidelines to employers, both private and public, on how to
(more)
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prevent harassment, how to deal with reports of harassment,
and what corrective action may be taken when harassment
occurs. Courts have interpreted and applied the statute to
provide relief in numerous cases. [See, for example, Murray
v. Oceanside Unified School District (2000) 79 Cal.App.4th
1338, dealing with sexual harassment, Winarto v. Toshiba
American Electronics Components , Inc. (2001) 274 F.3d 1276,
awarding punitive damages for harassment, and Murillo v.
Rite Stuff Foods, Inc. (1998) 65 Cal. App. 4th 833,
dealing with compensatory and punitive damages in sexual
harassment cases.]
In 2002, the Second District Court of Appeal, in a sharply
divided opinion, held that FEHA does not protect an
employee from harassment by a client or customer of the
employer. [ Salazar v. Diversified Paratransit, Inc. (2002)
103 Cal.App.4th 131.] The Supreme Court has just granted
review of the case. On June 4, 2003, the Fourth District
Court of Appeal, in Carter v. California Department of
Veterans Affairs , 2003 DJDAR 6009, issued the same holding.
This bill is intended to clarify what the appellate courts
have found to be a murky history of the legislative intent
behind SB 2012, invalidate those decisions, and address the
issue of harassment in the workplace by persons other than
employees, agents, and supervisors.
CHANGES TO EXISTING LAW
Existing law , the FEHA, makes it an unlawful employment
practice for an employer or other covered entity to harass
an employee or other covered individual because of race,
religious creed, color, national origin, ancestry, physical
disability, mental disability, medical condition, marital
status, sex, age, or sexual orientation. [Government Code
Section 12940(j)(1). All further statutory references are
to this Code.]
Existing law provides that harassment of an employee or
other covered individual by an employee other than an agent
or supervisor is unlawful if the employer knew or should
have known of the conduct and failed to take immediate and
appropriate corrective action. [Section 12940(j)(1).]
Existing law requires employers to seek to prevent all
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Page 3
harassment in the workplace by taking "all reasonable steps
to prevent harassment from occurring." [Section 12940(k).]
Existing case law recognizes various forms of harassment in
the workplace, including sexual harassment, same-sex
harassment, and racial harassment among others. [Citations
omitted.] Existing case law also requires employers to take
"a very dim view of all forms of harassment, whether by
supervisors or others." [ Carrisales v. Department of
Corrections (1999) 21 Cal.4th 1132, 1139.]
Existing law states, in the uncodified preamble to SB 2012
which enacted the anti-harassment provisions in FEHA in
1984, the Legislature's intent that "employers be required
to establish affirmative programs?so that work sites will
be maintained free from prohibited harassment and
discrimination by?[employers']?agents, administrators, and
supervisors as well as their non-supervisors and
clientele." [SB 2012, Watson, Chapter 1754, Statutes of
1984, Section 1.]
This bill would add, harassment of an employee by a
nonemployee as a violation of FEHA.
This bill would specify that in reviewing cases of
harassment involving acts of nonemployees, the trier of
fact shall consider the extent of the employer's control
and any other legal responsibility which the employer may
have with respect to the conduct of those nonemployees.
This bill would specify the Legislature's intent in
enacting this bill to construe and clarify the meaning and
effect of existing law and to reject the interpretation
given to the law in Salazar v. Diversified Paratransit,
Inc.
COMMENT
1. Need for the bill
The author states:
Every once in a while, a court decision comes down
in our sister branch that truly shocks the
conscience. This bill addresses one such case,
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where female bus driver Raquel Salazar was forced
to endure serious and repeated harassment by a bus
rider without her employer taking reasonable steps
to protect her. Amazingly, when Ms. Salazar sought
relief against her employer for the injuries she
suffered, the trial court, and subsequently the
court of appeal, held that no relief was available
under the FEHA and dismissed her case. This is not
only an outrage for Ms. Salazar, it is unacceptable
for all California workers, and we in the
Legislature must set it straight.
2. The Salazar court invited this legislation,
declaring legislative intent of original statute to be
clearly against employer liability for acts of
nonemployees
In fact, the Salazar majority invited the Legislature
to set the statute straight. "Although an uncodified
1984 preamble [to SB 2012] stated an existing policy
of maintaining worksites free from prohibited
harassment and discrimination by clientele, the
Legislature did not amend section 12940 to translate
that existing policy into statutory rights, remedies,
and liabilities. The Legislature, not this court,
should draft and enact statutes that define the scope
of employer liability." [ Salazar , supra, at 135.]
Raquel Salazar was employed as a bus driver by
employer Diversified Paratransit, Inc. to transport
developmentally disabled adults and children from
their homes and care providers to day care centers and
schools. The person accused of harassing Salazar was
a passenger on her bus route. The passenger
repeatedly subjected Salazar to various acts, such as
touching her hair and other parts of her body,
exposing himself to her, grabbing her arms, until one
day he sexually attacked her. Salazar quit her job
after writing two incident reports and the last
attack.
Despite the seriousness of the sexual harassment acts
committed against Ms. Salazar, the trial court granted
the employer a nonsuit and the appellate court
sustained the judgment. The majority opinion traced
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the legislative history of SB 2012, the bill that
enacted the anti-harassment statute, and concluded
that Section 12940(j)(1) does not create employer
liability for harassment of an employee by a client or
customer. Since the Legislature, the opinion said,
specifically deleted language that would have made
employers liable under this statute for harassment by
clients or customers, it must have considered and then
rejected the language, and it is not for the court to
construe the statute to incorporate the omitted
language.
The court also argued that since the Legislature
derived the language of Section 12940 from the federal
Equal Employment Opportunity Commission regulation
implementing Title VII in effect at that time, but did
not incorporate the parts of the EEOC regulation that
protect employees from sexual harassment by
nonemployees in the workplace, this protection was
intentionally omitted.
Dismissing the language in the preamble contained in
SB 2012 that agencies and employers are required to
establish affirmative programs so that "worksites will
be maintained free from prohibited harassment and
discrimination by their agents, administrators, and
supervisors as well as by their nonsupervisors and
clientele" as inconsistent with the codified parts of
the statute, the court decided that even if the
statute were to be liberally construed as required,
the Legislature would have used clearer language than
that found in Section 12940, had it intended the
broader liability under FEHA.
This bill would clearly extend the protection now
afforded to employees who are harassed in the
workplace by other employees to employees harassed in
the workplace by nonemployees (clientele and customers
as well as other third parties). If enacted, this
bill would invalidate the court's holding in Salazar ,
as well as in the Carter case, which used the same
reasoning to get to the same holding. ( Carter was
brought by a female nurse employed in one of the
Department of Veterans Affairs' homes for veterans,
who was harassed by a resident veteran.)
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The strongly worded dissenting opinion in Salazar
illustrates the need for the Legislature fix a problem
that, in P.J. Klein's view, does not exist: "There is
no good reason, after all these years, to revisit the
statute in order to strip employees of protection from
client harassment. In accordance with the
Legislature's declared intent, this court should hold
an employer liable under section 12940 for harassment
by an employer's 'clientele' (Stats. 1984, ch. 1754,
1) if the employer had actual or constructive
knowledge of the harassment and failed to take 'all
reasonable steps' necessary to prevent harassment from
occurring." From the outset, Presiding Justice Klein
argued that the preamble in SB 2012 requiring
employers to maintain worksites free from harassment
by "non-supervisors and clientele" should have settled
the Salazar case, citing Barker v. Brown & Williamson
Tobacco Corp. (2001) 88 Cal.App.4th 42. Had Justice
Klein prevailed, this bill would not be before the
Committee today.
Supporters of the bill agree with Presiding Justice
Klein. They argue that (1) the express language of
FEHA requires a broad application of the statutory
language; (2) Section 12940(j)(1) states an inclusive
responsibility for an employer to "take all reasonable
steps to prevent harassment from occurring"; (3)
Section 12940(i) prohibits any person?from inciting or
compelling acts of harassment, implying thus that an
employer should be vigilant to a wide range of
potential harassing behavior; and (4) employers
exercise a purposeful degree of control over potential
customers through targeted advertising, routinely
require their employees to follow procedures in their
dealing with customers and clients, and therefore
should be equally vigilant regarding any harassing
behavior on the part of customers.
This bill would set the record straight with regards
to the original intent of the Legislature when it
enacted the anti-harassment in the workplace statute
in 1984.
3. Bill adopts EEOC regulation language, but applies
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it to all harassment and requires employer control for
liability
As suggested by the opponents to the bill and by the
court, this bill now contains language lifted from the
EEOC regulation dealing with employer liability for
harassment in the workplace by nonemployees.
a. AB 76 would make employer liable for all
harassment, not just sexual harassment, committed by
nonemployees
The EEOC regulation after which AB 76 was patterned
limits employer liability to sexual harassment by
nonemployees. However, in importing that regulatory
language into the FEHA, this bill removed the
reference to "sexual harassment" thus making the bill
applicable to all forms of harassment.
Opponents state that AB 76 should have adopted the
EEOC language in its entirety, and thus would have
limited employer liability for harassment by
nonemployees only to sexual harassment. This would
greatly reduce the number of businesses that would be
burdened by the anti-harassment statute then, they
state, since the state subjects all employers with 5
or more employees to FEHA already (the federal law
applies to those with 15 or more employees).
Supporters however point to the long-standing policy
of the state, unchallenged in its application by the
courts, that all forms of serious harassment is
prohibited in the workplace, if the employer knows or
should have known of the conduct and fails to take
appropriate corrective action. Thus, they say, there
is no reason to limit the liability for harassment by
nonemployees to sexual harassment.
This bill would provide an employee the same
protection from harassment, i.e., all forms of
harassment, in the workplace, whether committed by
another employee or by a nonemployee.
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b. AB 76 would require trier of fact to consider
degree of employer control over nonemployees' behavior
The relevant EEOC regulation (29 C.F.R. part 1604,
1604.11, effective Nov. 10, 1980) states:
(e) An employer may also be responsible for the
acts of non-employees, with respect to sexual
harassment of employees in the workplace, where
the employer (or its agents or supervisory
employees) knows or should have known of the
conduct and fails to take immediate and
appropriate corrective action. In reviewing
these cases the commission will consider the
extent of the employer's control and any other
legal responsibility which the employer may have
with respect to the conduct of such
non-employees.
The second underlined sentence of this regulation
is incorporated verbatim in AB 76 (except for the
substitution of "trier of fact" for "Commission."
The language acknowledges that an employer's
liability depends to a large extent on the degree
of control an employer has over any given situation
of harassment in the workplace. Most of the
opponents of AB 76, as originally drafted and heard
in the Assembly, have tempered their opposition
with the inclusion of this language in the bill.
4. Passage of AB 76 would ensure that California law is
consistent with federal law with respect to harassment in
the workplace by nonemployees
There is no question that without this bill, California
law, after Salazar and Carter , would be inconsistent with
federal statutory, regulatory, and case law with respect
to harassment of an employee in the workplace by
nonemployees. California would then provide less
protection to workers than federal law does in this area.
This would create an anomalous situation because all
other worker protection laws under FEHA are more
expansive than federal law in scope and application.
5. Opponents' view of Salazar and AB 76
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Although, as indicated above, opposition to AB 76 has
been tempered by the incorporation of the EEOC regulatory
language into the bill, the Chamber of Commerce continues
to oppose the bill based on what they say is the bill's
imposition of "unreasonable liability on the business
community." SBC, another opponent, states that AB 76
would "unfairly change a basic principle underlying
California's current employee harassment law - that
employers can only be liable for harassment of their
employees by persons within the employer's control.
Employers have a degree of legal control over the
behavior of employees in the work environment, but have
no comparable legal control over nonemployees, especially
the actions of nonemployees outside of the employer's
premises?[this bill] will clearly lead to increased
litigation, thereby overburdening the courts and
employers."
The recent addition of the EEOC language would appear to
address SBC's concern.
6. Author's technical amendment
The author intends to offer a technical amendment in
Committee, to clarify that the employer's control shall
be considered in determining employer liability for
harassment by nonemployees in the workplace, whether the
issue is to be resolved in an administrative or other
quasi-judicial or court setting.
Support: Attorney General Bill Lockyer; American
Federation of State, County
And Municipal Employees (AFSCME), AFL-CIO;
Anti-Defamation League; California Conference Board
of the Amalgamated Transit Union; California
Conference of Machinists; California Commission on
the Status of Women; California Employment Lawyers
Association (CELA); California Faculty Association;
California Independent Public Employees Legislative
Council; California Labor Federation; California
Organization of Police and Sheriffs (COPS);
California Professional Firefighters (CPF);
California School Employees Association; California
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State Association of Electrical Workers; California
State Employees Association; California State Pipe
Trades Council; California Teachers Association;
Consumer Attorneys of California; Equality
California (EQCA); Lambda Letters; Protection &
Advocacy, Inc. (PAI); Services Employees
International Union (SEIU); Teamsters; Western
States Council of Sheet Metal Workers
Opposition: Ad Industries, Inc.; Associated Builders and
Contractors of
California; Automotive Aftermarket Services Inc.
(AASI);
California Apartment Association; California
Assisted Living
Association (CALA); California Association of
Health Facilities
(CAHF); California Association of Sheet Metal and
Air
Conditioning Contractors, National Association
(CAL SMACNA);
California Bankers Association; California
Chamber of
Commerce; California Grocers Association (CGA);
California
Healthcare Association (CHA); California
Manufactures &
Technology Association (CMTA); Charles Leonard
Western, Inc;
Civil Justice Association of California (CJAC);
Motion Picture
Association of America, Inc.; Murrieta Chamber of
Commerce;
National Federation of Independent Business
(NFIB); Orange
County Fire Authority (OCFA); SBC
HISTORY
Source: California Labor Federation, AFL-CIO and
California NOW (sponsors)
Related Pending Legislation: AB 1617 (Montanez) would
amend the same section in FEHA to
require the use of a trained
AB 76 (Corbett)
Page 11
investigator to investigate
allegations of harassment. The bill
is a two-year bill, and had not been
heard in any policy committee.
Prior Legislation: SB 2012 (Watson, Ch. 1754, Statutes of
1984) see Background.
Prior Vote: Asm. Jud. (Ayes 11, Noes 3);
Asm. L. & E. (Ayes 6, Noes 2);
Asm. Appr. (Ayes 19, Noes 6);
Asm. Flr. (Ayes 50, Noes 27)
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