In Jones v. The Lodge at Torrey Pines Partnership, (— Cal.Rptr.3d —, 2008 WL 553670, Cal., March 3, 2008), the California Supreme Court considered whether a supervisor could be held personally liable in an employee’s lawsuit for retaliation under the Fair Employment and Housing Act (“FEHA”). The Supreme Court held that a nonemployer individual such as a supervisor may not be held liable for retaliation.
Scott Jones brought a lawsuit against his employer, The Lodge at Torrey Pines, for among other things, sexual orientation discrimination and retaliation. He also sued his supervisor, Jean Weiss, for retaliation. A jury awarded Jones compensatory damages of $1,395,000 against the Lodge and $155,000 against Weiss.
The trial court found that the jury's verdict in favor of Jones could not stand because there was insufficient evidence of an adverse employment action to support the claims of discrimination and retaliation against the Lodge and also because a supervisor cannot be held liable for retaliation. A Court of Appeal reversed the trial court's decision and held that an individual can be liable for retaliation under the FEHA. The Court of Appeal reinstated the jury's verdict in favor of Jones. The Lodge and Weiss sought review by the California Supreme Court.
Supreme Count Decision
The Supreme Court granted the petition for review on the limited question of “whether an individual may be held personally liable for retaliation under the FEHA.” The Court held that an individual, such as supervisor, may not be held personally liable for retaliation under the FEHA.
The FEHA, at Government Code section 12940, prohibits certain employment practices such as harassment, discrimination, and retaliation. Section 12940 subdivision (h) addresses retaliation and provides that it shall be unlawful for “any employer, labor organization, employment agency, or person to discharge, expel, or otherwise discriminate against any person because the person has opposed any practices forbidden under this part or because the person has filed a complaint, testified, or assisted in any proceeding under this part.”
Section 12940, subdivision (j), which deals with harassment, clearly imposes personal liability on employees for their own harassing actions. Subdivision (j) states, “Any employee of an entity subject to this subdivision is personally liable for any harassment prohibited by this section that is perpetrated by the employee . . . .” Subdivision (h) lacks a clear directive that employers may be held personally liable. The Court determined that subdivision (h) is ambiguous as to whether it imposes personal liability on employees.
In Reno v. Baird (1998) 18 Cal.4th 640, the Supreme Court held that “although the employer may be liable for unlawful discrimination, individuals working for the employer, including supervisors, are not personally liable for that discrimination.” The Legislature treated harassment and discrimination differently because there is a “fundamental distinction between harassment as a type of conduct not necessary to a supervisor’s job performance, and business or personnel management decisions — which might later be considered discriminatory — as inherently necessary to performance of a supervisor’s job.” Also, the FEHA exempts some small employers, those with less than five employees, from liability for discrimination. Liability for harassment, however, is not conditioned on the number of employees that an employer employs.
The Court noted the following reasons for not imposing liability for discrimination on individual employees: (1) a supervisor can avoid personally harassing an employee, but cannot avoid making personnel decisions, (2) it would be inconsistent to exempt small employers from liability for discrimination, but to hold individual nonemployers liable for discrimination, (3) “sound policy favors avoiding conflicts of interest and the chilling of effective management,” (4) decisions made at the corporate level are often made collectively, and (5) “it is bad policy to subject supervisors to the threat of a lawsuit every time they make a personnel decision.” The Court found that all of these reasons for not holding individuals liable for discrimination “apply equally to retaliation.” There appears to be no reason why the Legislature “would want to make nonemployer individuals personally liable for retaliation but not for discrimination.”
Also, the employment actions that support a cause of action for retaliation are the same actions that give rise to a cause of action for discrimination. The Court opined that “it is hard to conceive why the Legislature would impose individual liability for actions that are claimed to be retaliatory but not for the same actions that are claimed to be discriminatory.”
The Court found nothing in the legislative history of subdivision (h) indicating that the Legislature intended to impose personal liability on nonemployer individuals. Based on its interpretation of section 12940 (h), the Court concluded that “the employer is liable for retaliation under section 12940, subdivision (h), but nonemployer individuals are not personally liable for their role in that retaliation.” It remanded the case back to the Court of Appeal for further proceedings.