What Effect Do the Recent Supreme Court Title VII Cases Have on California Employers?

On June 24, 2013, the U.S. Supreme Court handed down two opinions that were largely heralded as great victories for companies that are regularly sued under Title VII, the federal statute that prohibits: 1) discrimination on the basis of race, color, national origin, sex, and religion; and 2) retaliation against employees that complain of discrimination on one of these enumerated grounds.  In Vance v. Ball State University, 570 U.S. ___ (2013) (“Vance”) the Court defined “supervisor” for purposes of employer harassment liability.  In University of Texas Southwest Medical Center v. Nassar, 570 U.S. ___ (2013) (“Nassar”) the Court identified a strict “but/for” standard in retaliation cases, holding that an employer is not liable for retaliation under Title VII if it would have taken the same action even if the employee had not engaged in the protected conduct of complaining about discrimination.

When Vance and Nassar were handed down, employers emitted audible sighs of collective relief and plaintiff’s attorneys hung their heads in defeat.  But was this just a knee jerk response?  Both of these opinions were analyzed under the auspices of Title VII, a federal statute.  However, California employees generally raise their claims of discrimination, harassment and retaliation under the state’s Fair Employment and Housing Act (“FEHA”) because it provides much broader protections.  This poses the question of whether employers in California will experience any relief stemming from these decisions.

Who is a Supervisor?

In Vance, a controversial opinion delivered by Justice Alito, the Supreme Court resolved a Circuit Court split over the definition of a “supervisor” for Title VII liability in harassment cases.  Defining who qualifies as a supervisor is important because employers are vicariously liable for their supervisors’ discriminatory harassment.  The Court rejected a broader approach that defined a supervisor as a person who directed the plaintiff’s daily work activities.  Instead, the Court held that supervisors are only those with the authority to “take tangible employment actions against the victim … such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing significant change in benefits.”  In most states, employers and their attorneys rejoiced over the narrowly adopted definition, but employers in California would be well advised not to put much stock in the Court’s opinion.

For California employers, Vance’s impact on harassment cases based on FEHA is likely to be limited.  The FEHA imposes strict liability on employers for harassment committed by a supervisor and defines “supervisor” in a manner that resembles the EEOC standard that Vance rejected.  (See Cal. Gov’t Code § 12926(s).)  In fact, the definition of a supervisor under California’s FEHA specifically includes a person who has responsibility to direct other employees.  California courts have relied on this definition to hold that the authority to direct the plaintiff’s day-to-day work could be sufficient to establish supervisory status.  (See Chapman v. Enos, 116 Cal. App. 4th 920, 930-31 (2004) (holding that an employee having the authority to direct other employees’ day-to-day duties is a “supervisor” even if he or she does not have the power to make tangible employment actions, such as hiring, firing, or ordering transfers)).  Thus, California employers sued under the state’s FEHA are not likely to find much cause to celebrate the Vance decision.

What is the Standard to Establish Employer Retaliation?

The other big victory for employers sued under Title VII came in Nassar, 570 U.S. __ (2013).  The question in Nassar was whether the retaliation provision of Title VII requires a plaintiff to prove but-for causation (i.e., that an employer would not have taken the retaliatory employment action “but for” the plaintiff’s engaging in protected conduct) ‒ or instead, merely requires proof that the employee’s complaints were a “motivating factor” for the employer’s retaliation.  The Supreme Court adopted the strict but-for causation standard, making it much more difficult for employees to prevail on retaliation claims.

In contrast, the California Supreme Court recently adopted a broader causation standard for FEHA discrimination cases in Harris v. City of Santa Monica, 56 Cal. 4th 203 (2013) (“Harris”).  In Harris, the Court held that a plaintiff must prove that her protected status was a “substantial motivating factor” in the employer’s adverse employment action.  While this holding was specifically in the context of establishing discrimination, California’s FEHA uses the same language to define the causation standard for both retaliation and discrimination claims.  Some have speculated that because the Harris holding did not specifically address retaliation, California courts might still be influenced by Nassar when deciding retaliation claims.  However, since the FEHA uses the same language to articulate the causation standards for both causes of action, courts are more likely to apply the “substantial motivating factor” standard to retaliation claims.

Conclusion

Employers in California are subject to both federal and state law so employers that escape liability under Title VII can still be held liable under California’s FEHA.  Because of the broader protections provided under FEHA, employees are more likely to sue under the state law.  As a result, the recent Supreme Court Title VII cases are expected to have little, if any, effect on employers sued in California.