BILL ANALYSIS
AB 2889
Page 1
Date of Hearing: March 30, 2004
ASSEMBLY COMMITTEE ON JUDICIARY
Ellen M. Corbett, Chair
AB 2889 (Laird) - As Introduced: February 20, 2004
SUBJECT : PROTECTIONS FOR VICTIMS OF WORKPLACE HARASSMENT BY
CUSTOMERS AND OTHER NON-EMPLOYEES
KEY ISSUE : SHOULD THE LOOP HOLE IN CURRENT LAW THAT PROVIDES
LESS PROTECTION FOR VICTIMS OF RACIAL, DISABILITY, RELIGIOUS,
AND OTHER FORMS OF HARASSMENT THAN FOR VICTIMS OF SEXUAL
HARASSMENT IN "THIRD PARTY" WORKPLACE HARASSMENT CASES BE
CLOSED?
SYNOPSIS
This bill closes the "loop hole" created last year when AB 76
(Corbett) was enacted to clarify that employers in California
are required, consistent with federal law, to take reasonable
steps to protect their employees from sexual harassment
perpetrated by an employer's customers, clients or other
non-employees. Due to political opposition from some businesses
last year that wanted AB 76's worker protections limited to
sexual harassment but not to other equally serious forms of
harassment, such as disability, religious, or racial
harassment, last year's measure was explicitly limited to sexual
harassment at the end of the legislative process.
However since that time it has been noted that last year's
limitation may have inadvertently created an unprecedented
"hierarchy" of harassment protections favoring sexual harassment
protection over the many other forms of legally-protected
harassment involving race, sexual orientation, religion, color,
national origin, ancestry, disability, medical condition, age,
and marital status. According to the author, this bill merely
seeks appropriately to "equalize" worker protections against
harassment so that the particular type of serious harassment
being perpetrated by a customer, client or other third party in
the workplace will not determine the need to protect against
workers from it. The author states that through this bill the
message about harassment by customers and clients will be clear:
such harassment, regardless of its hateful basis (be it
religious, racial or otherwise) will not be tolerated.
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Supporters of the bill, made up of the Attorney General as well
as many statewide labor and civil rights groups, argue that, by
closing last year's politically-created loop hole, this bill
merely brings California law in line with the broader
protections provided under federal law so that California
workers are not afforded less protection against third party
harassment than they receive under federal law. Opponents, on
the other hand, comprising the Civil Justice Association and
other business organizations, argue that employers in California
will face new liability for third party harassment under the
bill and that current law in this area adequately protects
California's workers.
SUMMARY : Seeks to close the loop hole in current law that
provides less protection for victims of racial, disability,
religious and other forms of harassment than for victims of
sexual harassment in so-called "third party" (customer or
client) harassment cases. Specifically, this bill :
1)Clarifies language in the Fair Employment and Housing Act
(FEHA) to ensure that under state law employers may be
potentially liable for all of the protected forms of
harassment, including not just sexual harassment but racial,
disability, religious, and other types of harassment, that are
committed against their workers by clients, customers and
other third parties, when they knew or should have known of
the harassment, and failed to make reasonable efforts to stop
it.
2)Continues in place the proviso requested by business
organizations last year that ensures that in these third party
harassment cases, California law makes clear that the degree
(or lack of thereof) of the employer's ability to control the
improper conduct of third parties such as customers or clients
who harass their employees shall be appropriately taken into
account when fact finders consider whether there should be any
liability assessed the employer.
3)Effectively brings state law in line with the broader
protections provided under federal law so that California
workers are not afforded less protection against third party
harassment than they receive under federal law.
EXISTING LAW :
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1)Makes it an unlawful employment practice, under the FEHA, 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.)
2)Provides under long-standing statutory law that harassment of
an employee or other covered individual by another employee
(other than an agent or supervisor) is unlawful only if the
employer knew or should have known of the conduct, and failed
to take immediate and appropriate corrective action. (Section
12940 (j)(1) and (k).)
3)Provides, pursuant to AB 76's clarification last year, that an
employer has always been potentially liable for the harassment
perpetrated by non-employee third parties against its
employees pursuant to the state's Fair Employment and Housing
Act. However such potential liability may only occur when the
employer, or its agents or supervisors, knows or should have
known of the conduct, and fails to take immediate and
appropriate corrective action. In addition, in these
so-called third party harassment cases, the law explicitly
makes clear that the extent of the employer's control, and any
other legal responsibility which the employer may have with
respect to the conduct of those non-employees, shall be
considered. (Section 12940 (j)(1) enacted pursuant to AB 76,
Ch. 671, Statutes of 2003.)
4)Requires employers in California to seek to prevent all
harassment in the workplace by taking "all reasonable steps to
prevent harassment from occurring." (Section 12940 (j)(1) and
(k).)
5)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
(emphasis added.))
6)Contains, in the uncodified preamble to the FEHA since 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,
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administrators, and supervisors as well as by their
non-supervisors and clientele."(Stats.1984, ch. 1754, 1
(emphasis added).)
FISCAL EFFECT : The current version of this bill is keyed
fiscal.
COMMENTS : This measure seeks to close the loop hole in current
law that provides less protection for victims of racial,
disability, religious and other forms of harassment than for
victims of sexual harassment in so-called "third party"
harassment cases.
In support of the bill, the author states:
Chairwoman Corbett's measure last year made clear once
and for all that workers in California are protected
from serious harassment by customers, clients and
others when their employers knew or should have known
of the harassment and failed to take reasonable steps
to halt it. Her AB 76 was a critically important civil
rights measure about which we should all be very proud.
However since that time it has become clear that an
anomaly may have been inadvertently created when some
businesses last year insisted that AB 76's protections
be expressly limited to sexual harassment only. This
political demand created the potential for an
unprecedented "hierarchy" of harassment protections
favoring sexual harassment over other serious forms of
hate-based behavior including racial, sexual
orientation, religious, color, national origin,
ancestry, disability, medical condition, age, and
marital status harassment. This bill clears up that
unacceptable anomaly and "equalizes" worker
protections against all forms of harassment, regardless
of the type of harassment involved.
Passage Of The Legislation Will Bring State Law Consistent With
Federal Law Regarding Third Party Harassment : The federal cases
appear clear in their conclusion that an employer may be held
liable for a non-employee's harassment of an employee, if the
employer fails to remedy or prevent a hostile or offensive work
environment which management-level employees knew, or in the
exercise of reasonable care should have known, existed. (See,
e.g., Crist v. Focus Homes, Inc. (8th Cir. 1997) 122 F.3d 1107,
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1112 (residential home could be held liable for failing to take
reasonable steps to protect its employees from sexual assaults
by a client with a developmental disability who had a known
history of sexually harassing his caregivers)).
Some opponents of this bill, however, suggest that federal law,
as interpreted by federal courts and the federal Equal
Employment Opportunity Commission (EEOC), only protects workers
from sexual harassment in third party harassment cases and not
other forms of harassment. However a review of the pertinent
federal case law and EEOC regulations suggests opponents' claims
are ill-founded, that, to the contrary, federal regulations and
court cases do indeed hold that employers may be held liable for
third party harassment other than sexual harassment.
For example, just three years ago in Peries v. New York City
Board of Education (2001 U.S.Dist LEXIS 23393), a federal
district court cited the federal third party harassment
regulation in support of its conclusion that a teacher's
employer could potentially be found liable for third party
harassment not based on sexual harassment, but on national
origin harassment.
The federal regulation regarding third party harassment cited by
that court does indeed make clear that bases other than sexual
harassment are covered under Title VII protections. For
example, in its guide found on the Web at
www.eeoc.gov/docs/harassment-facts.html the EEOC notes that its
regulations interpreting Title VII do not apply solely to sexual
harassment, but "to all types of unlawful harassment." It
further states that the Equal Employment Opportunity Commission
has "always taken the position that the same basic standards
apply to all types of prohibited harassment. Thus, the standard
of liability set forth in the decisions applies to all forms of
unlawful harassment." And the federal agency also notes in its
helpful guidance to employers that "Title VII law and agency
principles will guide the determination of whether an employer
is liable for age [i.e., non-sexual] harassment by its
supervisors, employees, or non-employees." (Emphasis added.)
Opponents to this legislation have not cited any authority that
contradicts that federal case law and regulations provide the
very protection for non-sex based harassment that this measure
ensures. It thus appears clear that enactment of this bill will
ensure that state law in this area is consistent with the
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federal approach to third party harassment regarding the
protected categories of harassment protected under state law.
The converse is also true: if this measure is not enacted,
California law in this area will arguably continue to be less
worker-protective than federal law.
California Treatises Also Have Long Recognized that Employers
Could Be Held Liable for Failing to Protect Their Employees from
All of the Protected Forms of Third Party Harassment : Leading
California practice guides on employment law have long stated
that an employer may be held liable for harassment of its
employees by non-employees, when the employer fails to take
reasonable steps to prevent the harassment - without noting any
limitation as to whether such protections are limited to sexual
harassment. (See, e.g., Chin, Cathcart, Exelrod & Wiseman,
Cal.Prac. Guide: Employment Litigation (The Rutter Group 2001),
Sections 10:119-10:120, 10:410-10:411; 2 Advising California
Employers (Cont.Ed.Bar 2d 3d. 2001) section 16.78, p. 1012; 2
Wilcox, California Employment Law, section 41.81[6][d].)
The Uncodified Intent Provision in FEHA Would Appear to Settle
Any Argument Here. As noted above, the uncodified preamble to
the FEHA has for almost 20 years stated legislative 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 by their
non-supervisors and clientele." (Stats.1984, ch. 1754, 1,
emphasis added.) No where in this language did the Legislature
state any intention to limit FEHA's third party harassment
coverage just to sexual harassment and not to the other
protected types of harassment. It is well-settled that
uncodified provisions of a statute may be relied upon as
reliable indicators of legislative intent. (See, e.g., Barker
v. Brown & Williamson Tobacco Corp. (2001) 88 Cal.App.4th 42,
49.)
The View of the Department of Fair Employment and Housing : It
should be noted that in response to an inquiry from the
Committee last year as to the view of the state agency vested
with the duty for interpreting and implementing the FEHA, the
Department verified to the Committee that it has long considered
such cases against third parties covered under the umbrella of
the FEHA regardless of the type of protected harassment
involved. As Justice Klein noted in her dissent in the Salazar
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case invalidated by AB 76 last year, it is well settled that
agency interpretation is an interpretive tool, and it is
appropriate to look to the Department's interpretation for
guidance.
Thus federal cases and regulations, as well as a review of the
state's own controlling statute and agency interpretations, all
lead to the conclusion that enactment of this bill will
essentially bring California law involving third party
harassment in line with federal protections in this area.
Neither AB 76 of Last Year or This Measure Create Strict
Liability for Employers : Finally, in support of this measure
the author states to the Committee that it may be helpful, in
light of the confusion that has been thrust at this measure and
at AB 76 last year, to recall that neither bill creates strict
liability on the part of employers. The test for employer
liability continues to be what his always been, one of
reasonableness - did the employer take reasonable steps, once it
knew or should have known the harassment was occurring, to stop
it from reoccurring? Nor does this bill change existing law as
to what constitutes harassment. Employees still will not be
able to sue their employers for minor workplace annoyances. In
order for there to be liability under AB 76 or this bill, the
alleged harassment must be sufficiently severe or pervasive that
it produces a hostile working environment. In short, under this
bill, employers are not now and will not be held liable for
insignificant, one-time events that they could not have
anticipated or prevented. Finally, the author notes, contrary
to the claims made by some business opponents of the bill, the
measure will not hold an employer liable for any actions of a
client, customer, or "passer-by." Rather, the author points
out, the bill only holds an employer liable for its own action
or inaction, and then and only then when the employer knew or
should have known of the illegal harassment occurring against
one of its employees and it failed to take reasonable action to
prevent it from occurring.
ARGUMENTS IN SUPPORT : The Office of the Attorney General, many
statewide and local labor organizations, and the breadth of
groups representing those workers who currently may be held to
have less protection from third party harassment that those
injured by sexual harassment, strongly support this measure.
ARGUMENTS IN OPPOSITION : The Civil Justice Association of
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California (CJAC) opposes this bill because "it will subject
employers to liability for all forms of third party harassment."
It also opposes the bill because "Assembly Bill 76 ... expanded
California law beyond federal law that covers only employers
with 15 or more employees." The California Apartment
Association (CAA) also opposes the bill. Though not citing
authority for its contention that federal regulations in this
area apply only to sexual and not other forms of harassment
(other than a cite to the general regulation itself which does
not so state), the group nevertheless states its support for
maintaining a hierarchical approach to protecting its employees,
whereby those of its employees subjected to serious third party
harassment that is not sexual in nature but perhaps of another
type (e.g., age, race, etc.) should receive less protection
under California law than those subjected to sexual harassment.
The California Bankers Association (CBA) also expresses similar
support for maintaining the current lesser protection in
California law for those of its employees who happen to be
harassed on bases other than those of a sexual nature.
REGISTERED SUPPORT / OPPOSITION :
Support
Attorney General's Office
California Conference of the NAACP
California Labor Federation, AFL-CIO
California NOW
California School Employees
Association (CSEA)
Protection & Advocacy, Inc.
American Civil Liberties Union (ACLU)
American Federation of State, County and Municipal Employees
(AFSCME)
California Council of The Blind
California Employment Lawyers Association (CELA)
California Professional Firefighters (CPF)
Congress of California Seniors
Consumer Attorneys of California
Equality California (EQCA)
Mexican American Legal Defense and Educational Fund (MALDEF)
Opposition
California Apartment Association
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California Association of Health Facilities (CAHF)
California Bankers Association (CBA)
Civil Justice Association of California (CJAC)
National Federation of Independent Business (NFIB)
Analysis Prepared by : Drew Liebert / JUD. / (916) 319-2334