BILL ANALYSIS
SB 650
Page 1
Date of Hearing: June 15, 2010
ASSEMBLY COMMITTEE ON JUDICIARY
Mike Feuer, Chair
SB 650 (Yee) - As Amended: June 7, 2010
SENATE VOTE : 23-15
SUBJECT : WHISTLEBLOWER PROTECTION ACT: UNIVERSITY OF CALIFORNIA
KEY ISSUE : SHOULD UC EMPLOYEES WHO BLOW THE WHISTLE ON IMPROPER
GOVERNMENTAL ACTIVITIES HAVE THE SAME RIGHTS AND REMEDIES AS
WHISTLEBLOWERS AT CSU?
FISCAL EFFECT : As currently in print this bill is keyed
non-fiscal.
SYNOPSIS
The Whistleblower Protection Act (WPA) generally protects state
employees who disclose an improper governmental activity or a
condition that may significantly threaten the health or safety
of employees or the public. A special provision governs the
administrative complaint procedure for University of California
(UC) employees. A California Supreme Court decision in 2008
held that, under that unique provision, a UC employee who has
been wronged by a violation of the WPA can bring suit to recover
damages only if the University wholly failed to reach a decision
within specified time limits. In other words, UC management has
control over whether UC is liable for the alleged violation it
has committed. By contrast, other state employees - including
those in the CSU system - are entitled to bring their case to
court for an independent determination if they do not receive a
satisfactory administrative decision. This bill would harmonize
the rights of UC whistleblowers with those of CSU employees.
This bill is substantively identical to a measure last year that
passed the Committee but was vetoed by the Governor. UC has not
filed opposition to the bill.
SUMMARY : Revises the Whistleblower Protection Act to treat
complaints by UC employees the same as those by CSU employees.
Specifically, this bill would provide that an action for damages
may not be brought unless the UC has reached or failed to reach
a decision within the time limits established by the Regents,
provided that this section shall not prohibit the injured party
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from seeking a remedy if the university has not satisfactorily
addressed the complaint within 18 months.
EXISTING LAW :
1)Protects state employees against whistleblower retaliation by
providing for the filing of a complaint with the State
Personnel Board (SPB) and, after the SPB has issued or failed
to issue a decision or findings on the complaint, by providing
for the filing of an action for damages in superior court.
(Gov. Code Sec. 8547.8.) The SPB is required to initiate a
hearing or investigation within 10 working days of receipt of
the complaint and complete the findings of the hearing or
investigation within 60 working days thereafter. (Gov. Code
Sec. 19683.)
2)Provides the same protection and procedure to employees of the
UC as to other state employees, requiring however that a
whistleblower retaliation complaint be filed first with the
University, and providing that an action for damages may not
be brought unless the University failed to reach a decision
within the time limits established by the regents for this
purpose. (Gov. Code Sec. 8547.10.) This statute was
construed by the California Supreme Court to mean that where
the University issued a decision within the time limits, a
plaintiff cannot bring the matter to court, regardless of the
outcome of the Regents' decision. (Miklosy v. The Regents of
the University of California (2008) 44 Cal.4th 876.)
3)Provides the same protection and procedure to employees of the
California State University (CSU) as that given to state
employees, requiring however that a whistleblower retaliation
complaint be filed first with the CSU, and providing that an
action for damages may not be brought unless the CSU failed to
reach a decision within the time limits established by the
trustees for this purpose. Under these provisions, however,
an injured party (plaintiff in a whistleblower retaliation
complaint) is not precluded from seeking a remedy if the CSU
has not satisfactorily addressed the complaint within 18
months. (Gov. Code Sec. 8547.12.)
COMMENTS : The author explains the need for the bill as follows:
There exists ambiguity in Government Code Section 8547 with
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regard to who is protected under the State's Whistleblower
Protection Act. Unlike all other state employees, UC
employees can only seek damages in court when the
university fails to reach a decision regarding the
complaint within the time limits established by the
regents.
In July 2008, the California Supreme Court ruled
unanimously that University of California employees who are
retaliated against because they reported wrongdoing cannot
sue for damages under the state's Whistleblower Protection
Act, so long as the University itself reviews the
complaints and reaches a decision in a timely fashion. The
ruling uncovered an oversight made by the Legislature when
the Act was amended in 2001, which provided legal standing
for all other state employees to seek damages.
While the Court was unanimous in their ruling, three of the
seven judges urged the Legislature to consider changes to
the law as the current statute undermines the purpose of
the Act: "The court's reading of the Act, making the
University the judge of its own civil liability and leaving
its employees vulnerable to retaliation for reporting
abuses, thwarts the demonstrated legislative intent to
protect those employees and thereby encourage candid
reporting," wrote Justice Kathryn Mickle Werdegar, joined
by Chief Justice Ronald George and Justice Carlos Moreno.
"If the same government organization that has tried to
silence the reporting employee also sits in final judgment
of the employee's retaliation claim, the law's protection
against retaliation is illusory."
SB 650 would fix this oversight and provide UC employees
the same whistleblower protections and legal standing as
CSU employees. The bill provides that UC employees can seek
damages once the administrative process is complete. This
bill corrects the oversight in statute, and thereby
protects UC workers from unfair retaliation for rightfully
reporting waste, fraud, or abuse.
This Bill Responds to Interpretation of the Whistleblower
Protection Act in Recent Court Decision. In Miklosy v. Regents
of the University of California (2008) 44 Cal.4th 876, the
plaintiffs Miklosy and Messina were computer scientists who were
employed by the University of California at the Lawrence
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Livermore National Laboratory (Laboratory). In the course of
their work, the scientists identified problems with the project,
which they expressed to management orally and in writing. On
February 28, 2003, three supervisors fired Miklosy, who then
overheard the same three supervisors declare that Messina would
be next. Messina then submitted a letter of resignation and was
asked to reconsider over the weekend. However, when she
returned to her office after the meeting, she found that her
computer had been disconnected. After another meeting, and
overhearing another conversation where the supervisor indicated
an intention to fire Messina, Messina resigned.
Plaintiffs then filed complaints with the University under the
WPA. The Laboratory followed the procedure outlined in the
statute, and reached a decision adverse to the plaintiffs within
the time limits specified in its internal policies. This
decision became final. Plaintiffs then filed a damages action
in superior court against the University and three supervisory
employees alleging several causes of action, among them unlawful
retaliation in violation of the WPA. The trial court sustained
a demurrer, and the Court of Appeal affirmed, holding that
plaintiffs had no viable claim under the WPA because the
University timely resolved their complaints and further that the
other common law claims were statutorily barred.
The California Supreme Court affirmed, holding that the
statutory language in the WPA, particularly those provisions
pertinent to the UC, "means what it says, precluding a damages
action when, as here, the University of California has timely
decided a retaliation complaint." The court noted, "A damages
action in state court may afford complainants a more favorable
forum because the fact finder in state court is not a University
employee, and because other procedural protections apply, such
as evidentiary rules, testimony under penalty of perjury, and
cross-examination of witnesses. But the appropriateness of
granting these procedural protections to University
whistleblowers is a matter of policy that is not for this court
to determine."
In her concurring opinion, Justice Werdegar expressed her
concern that the University would essentially be policing itself
to the detriment of whistleblower employees, and injured
whistleblowers would not have access to independent judicial
review. She wrote:
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The decision we reach today, giving section 8547.10 its
literal meaning, will strongly undermine the purposes of
the Act, whose central purpose is ? [state employees should
be free to report waste, fraud, abuse of authority,
violation of law, or threat to public health without fear
of retribution]. For whistleblowing employees to be
confident they are protected against retaliation, they must
have recourse to a fair and impartial decisionmaking
process outside the line management of their employing
agency or University. If the same government organization
that has tried to silence the reporting employee also sits
in final judgment of the employee's retaliation claim, the
law's protection against retaliation is illusory.
I do not believe the [same] ? Legislature that ? created a
civil action for damages on behalf of a whistleblower
subjected to retaliation by the University "could
reasonably have intended the University to resolve
whistleblower retaliation claims by way of its own internal
procedures" (maj. opn., ante at p. 898) without any
meaningful judicial review. (Miklosy, 44 Cal.4th at 904.)
This bill would permit an action for the recovery of damages if
the University reached a decision on the plaintiff's complaint,
thereby overturning Miklosy and addressing Justice Werdegar's
concern.
This Bill Would Bring The Allowed Damages Action For Injured UC
Employees In Line With Those Afforded Injured CSU And Other
State Employees. Under existing law, an injured state employee
or applicant for employment may file an action for damages if
the injured party has first filed a complaint with the State
Personnel Board and the board has issued, or failed to issue,
findings, as specified. (Gov. Code Sec. 8547.8.) Also under
existing law, a CSU injured employee is not prohibited from
seeking a remedy if the University has not satisfactorily
addressed the complaint within 18 months. Because this bill
would allow an injured UC employee to bring an action for
damages if the University reached or failed to reach a decision
regarding the retaliation complaint within the established time
limits, injured UC employees would be treated comparably to
injured state employees and injured CSU employees.
UC Position. The University of California has not filed
opposition to this bill. UC did oppose the author's identical
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bill, SB 219 last year, arguing that claimants who are not
satisfied with the result of an administrative decision by the
University should be required to first seek judicial review of
that decision before suing for damages in order to preserve
deference to the administrative process. That argument appears
to be foreclosed by the intervening decision in Runyon v. Bd. of
Trustees of CSU, 48 Cal. 4th 760 (2010) holding that identical
language in the whistleblowing statute relating to CSU does not
require employees to exhaust the judicial remedy of a mandate
petition before pursuing an action for damages.
REGISTERED SUPPORT / OPPOSITION :
Support
AFSCME Local 3299 (UC) (sponsor)
AFSCME
California Employment Lawyers Association
California Labor Federation
California Newspaper Publishers Association
California Nurses Association
Californians Aware
Greenlining Institute
San Francisco Labor Council
Service Employees International Union
Three individuals
Opposition (as amended June 7)
None on file
Analysis Prepared by : Kevin G. Baker / JUD. / (916) 319-2334