Employers Continue to Face Difficult and Costly Litigation

Recent cases, involving both jury trials and settlements, demonstrate that employers continue to face difficult and costly litigation in employment law disputes. Fortunately, in two of the cases described in this article, the employers obtained a defense verdict, although most likely still incurred significant defense costs. The defense costs of a single plaintiff case, taken through trial, are estimated by some to be in the $300,000 range, for reputable defense firms. Moreover, the significant amount of actual defense costs does not begin to address the immense time commitment these cases require from an employer in preparing a defense. For example, the typical production of documents in a wage and hour case often involves compiling volumes of payroll records that cover significant periods of time. In addition, the depositions of supervisors, managers, human resources personnel, co-workers and many others may be required as part of the lawsuit. Thus, because of the substantial amount of time and expenses associated with employment law litigation, and because of the continuing barrage of these types of case, employers must understand and follow the law, properly train their staff, and document as needed, particularly in regards to personnel matters. Employers should also consider “Employers Practices Liability Coverage” (EPLI). This is a type of insurance which provides coverage for many employment related matters. Some policies even cover wage and hour disputes, which employers must increasingly contend with, particularly in regards to misclassification of employees and overtime compensation claims. The following cases, which involve age discrimination, harassment, sexual orientation discrimination, exempt/overtime claims and failure to accommodate disputes are only a small sampling of the employment law cases that continue to plague employers.

Discrimination/Failure to Accommodate/Sexual Harassment--Carmen Hunt v El Camino Community College District This case involved a jury trial in downtown Los Angeles, a venue where plaintiffs typically are very successful as Los Angeles juries are notorious for favoring plaintiffs. The case involved Carmen Hunt, a professor at El Camino College. Ms. Hunt alleged she was harassed and discriminated against by her superiors at the college. According to Ms. Hunt, the college tried to force her out because of her extended leaves of absence due to Post Traumatic Stress Disorder (PTSD). The leaves of absence occurred when she collapsed on campus in 2002, took a leave of absence until 2005, then returned on a part-time basis. Ms. Hunt also claimed that the college and the district did not accommodate her PTSD and that her superiors collected secret personnel files on her, which were defamatory. Further, she claimed she was sexually harassed and exposed to a hostile work environment all in violation of Education Code §87031. The college denied all accusations. After a week of trial, and only 50 minutes of deliberation, the jury returned a 12 – 0 verdict in favor of the defendant. This case demonstrates that employers can sometimes “fight city hall and still win.”

Sexual Orientation Discrimination--Parks v City of Oakland
Sherry Parks, a lesbian, was the only female plumber on the Port of Oakland (the Port) staff. She complained that she was harassed regularly because of her sexual orientation, that she was given unfair job assignments, and that she was subjected to a hostile work environment. The Port alleged that every job assignment and disciplinary action taken against Parks was for a legitimate business reason. After a 6 week trial the jury returned a 12 – 0 defense verdict in one day of deliberation. Parks was represented by Jean Hyams a graduate of Wellesley and UC Berkeley School of Law ( Boalt Hall) who was admitted to practice in 1989 and is a member of the State Bar’s employment law section. The Port of Oakland was represented by Edwin J Wilson, Jr., who graduated from UC Berkeley and UC Berkeley School of Law and was admitted to the practice of law in 1971. Mr. Wilson is a specialist in employment cases. This was obviously a significant victory for employers.

Wage and Hour/Overtime--Hilda Solis U.S. Secretary of Labor v Poetry Corporation
Don & J Inc., Nu Plus USA, Inc and A-do Fashion Inc., sewing contractors, produced goods for Poetry Corp, a garment manufacturer of women’s clothing from 2009 to 2010. The Department of Labor (DOL) filed suit against Poetry Corp alleging violations of the Fair Labor Standards Act (FLSA) regarding employees who worked for the sewing contractors. The DOL alleged that the contractors failed to pay its employees the federal minimum wage and also failed to pay overtime hours. Poetry Corp was also accused of transporting, delivering and selling products it knew were made by employees who were not lawfully compensated. According to the DOL, this was a sweatshop type case. The DOL sought to prevent future practices and also sought restitution for the employees – back pay and overtime. The case settled for $53,956 without admission of liability by the defendant. While we can be sure this cost the defendant a considerable amount in attorney fees and litigation costs, in our opinion the defense won this one because of the significant nature of the allegations and the relatively small size of the settlement.

Age Discrimination/Harassment--Judee Welch v Ivy Hill Corporation
This case was also a jury trial in downtown Los Angeles, which, as noted above, is a very “plaintiff friendly” venue. A defense verdict was reached on March 8, 2011, before the Honorable Richard Fruin, who is one of the most highly rated judges in downtown Los Angeles. In the case, Judee Welch alleged that she worked for Ivy Corporation from 1987 through March 2009, as a saleswoman, selling print to the music industry. During the last 4 ½ years of her employment a new vice president was brought in to supervise her and the rest of the sales staff. Welch alleges that during that time, the vice president/supervisor allegedly made comments about Welch’s age and allegedly showed preference for younger people in hiring and promotion. When the company was purchased in 2009, Welch was part of a layoff. She then filed a lawsuit alleging age harassment and age discrimination and prevailed. At the end of the 11 day trial the jury, in a 12 – 0 verdict, after 5 hours of deliberation, awarded Welch $213,000 loss of earnings and $731,000 in future loss of earnings. Her lawyer intends to move for attorney fees under the Fair Employment and Housing Act (FEHA). Welch’s lawyer, Carney Shegerian, was admitted to the practice of law after an undergraduate degree from Hofstra University and a law degree from Loyola University in Los Angeles. Defense counsel, Kelly O Scott, was admitted to the practice of law in 1987 after an undergraduate degree at UCLA and a law degree at USC.

NBoxley

Why Do Employers Lose So Many “Discharge For Misconduct” Cases

Employers often lose “discharge for misconduct” cases at the Employment Development Department (EDD) and at the California Unemployment Insurance Appeals Board (CUIAB). The following is a discussion of the steps an employer can take to increase the chances of prevailing in these types of cases.

What is at Stake?

An employer’s EDD tax rate can vary from 1.2 to 6.2%, depending upon the number of employees and the number of claims paid from the employer’s reserve account in Sacramento. Therefore, doing a good job in defeating an unemployment insurance claim can save a company a lot of money, in the long run.

How Does the Law Define Employee “Misconduct”?

Misconduct connected with an employee's work consists of four elements:

• A material duty owed by the claimant/employee to the employer in the employment contract, whether oral or written;

• A substantial breach of that duty;

• A willful or wanton breach or disregard of that duty; and

• A “disregard of employer's interests”; i.e., that which tends to injure the employer's interests.

Thus, actions which do not violate such a duty are not misconduct. See Precedent Board Decision P-B-3

Let's consider an employee’s breach of a company policy or procedure. Violations of an employer’s policies and procedures may be valid reasons to discipline an employee, including termination, if repeated violations occur. Further, some violations may justify an immediate termination. However, unemployment insurance law does not allow an employee to be discharged without consequences to the employer’s EDD tax rate, for breach of an unwritten or undefined rule, except for such things as stealing company property, gross negligence, gross insubordination, fighting on job, sexual assault, etc. Therefore, the key to success at the Employment Development Department (EDD) and at the California Unemployment Insurance Appeals Board (CUIAB) is adequate documentation and the appropriate workplace policies and procedures.

Absent extraordinary circumstances, such as referenced above, the EDD and the Administrative Law Judges expect to see a copy of the employer’s policy/procedures, proof that the employee was aware of the policy/procedures, proof as to how the policy/procedures were breached, evidence of any performance warnings issued, and evidence as to how the breach of the policy/procedures injured company interests.

It is important for employers to understand that if the breach of a company policy or procedure is not documented in the employee’s personnel file, courts may hold that “it did not happen.” Therefore, it is essential to properly document.

The following are examples of common problems faced by employers that lead to employers losing “discharge for misconduct” cases at the EDD and CUIAB:

• No proof employee knew of employer’s policy/workplace rule.

Employers must have written documentation that proves the employee “knew” of the policy/rule. The easiest way is to have a signed acknowledgement of receipt of the policy/rule (such as a signed employee handbook which contains the policy/rule) by the employee, in the personnel file;

• The employer fails to offer evidence that the employee’s duty, required by the policy/rule, was “material” (i.e. important to the company).

• There is insufficient proof that the employee “substantially breached” the policy/rule.

Employers must present evidence of a “substantial breach” of the employer’s policy/workplace rule. Examples of sufficient evidence: Company records, sworn witness statements, drawings, photographs, police reports, etc;

• The employee proves the employer’s policy/rule was inconsistently enforced.

Employers must be sure their company rules are equally enforced. For example: If an employer tolerates numerous tardiness in an month from some employees, the employer cannot then hold another employee to one tardy a month;

• The employer condones a breach of the policy/rule.

Employers wait too long to take disciplinary action following a substantial, willful breach of duty.

• Progressive discipline was not established, in the workplace.

The EDD and the CUIAB judges expect employers to show that they made a reasonable effort to change an employee's bad behavior, before discharging the employee;

• The employer fails to show how the breach harms (injures) its interests.

The employer must present evidence as to how the breach harmed the company;

• The employer cannot prove the last breach was “willful” or not for good cause.

This is a huge problem and probably a major reason that employers lose misconduct cases at the EDD.

Finally, employers should do the following:

• Send copies of their documents to the EDD as soon as an employee makes a claim for unemployment benefits;

• Immediately return all EDD telephone calls;

• Be sure to timely appeal (20 days) an adverse EDD determination;

• Attend CUIAB hearings with their witness and original documents;

• Be present at the hearing location at least 15 minutes before the hearing commences;

• Cite Precedent Board (PB) decisions supporting their case to both the EDD (when objecting to the claim), and when appealing to an administrative law judge; and,

• Ask the judge, after all evidence is in, and the judge states “anything further”, for the opportunity to make a “brief” closing statement. Do not take more than a minute or so.

David W. O'Brien, Esq

Floyd, Skeren & Kelly, LLP

A Former Administrative Law Judge with the CUIAB

Court Holds WC Claims Adjusters Are Exempt Employees

A recently released but (as of yet) unpublished California Appellate decision upheld a trial court finding that workers’ compensation claims adjusters are exempt employees, and therefore not entitled to overtime.

In Hodge v. Aon Insurance Services (Second Appellate District, 2/2/11), the appellate court differentiated the jobs performed by adjusters working for Cambridge Integrated Services Group from those performed by Farmers Insurance.  In doing so, the court determined that the job duties of the Cambridge adjusters meet the requirements for the administrative exception as detailed in Wage Order 4 (available online athttp://www.dir.ca.gov/IWC/IWCArticle4.pdf).  The upshot for employers is that the job title alone is insufficient to determine whether someone qualifies as an administrative employee.  Instead, the court took a close look at the adjusters’ actual job duties and how they related to the general business operations of both Cambridge and Cambridge’s clients in making their determination that the Cambridge adjusters were found to be exempt from the various overtime laws.

There are several requirements that must be met in order to properly classify an employee as exempt under the administrative exemption. The requirement at issue in Hodge was whether the duties involved the “performance of office or non-manual work directly related to management policies or general business operations of his/her employer or his/her employer’s customers.”  There are several ways to evaluate this.  The plaintiff argued for application of the “administrative/production worker dichotomy” as espoused in Bell v. Farmers Ins. Exhchange (2001 87 Cal.App.4th 805 (Bell II).  Bell II was a class-action suit brought by the claims representatives for Farmers Insurance.  In analyzing the job duties, the court in Bell II determined that the claim representatives’ responsibilities were restricted to “the routine and unimportant.”  They dealt with routine handling of mostly small value claims.  For more important or complex matters, the claims representatives served as a conduit for information to supervisors, who made the decisions, something that was found to be a “routine and unimportant” role.  In this instance, it was determined that the claims representatives were production, not administrative, employees.

The administrative/production dichotomy looks at whether an employee is involved in the everyday production aspect of a company, or alternatively, serves as a more important administrative employee doing work directly related to management policies or general business operations.  For example, a production worker for, say, K-Mart, would perform work related to selling consumer goods.  An employee involved in selecting which goods to carry, and in what amounts, would likely not be a production worker.

As described on pages 15-16 of Hodge,

Former 29 Code of Federal Regulations part 541.205(c) also provides illustrations of the types of work satisfying the “substantial importance” requirement. For example, the “cashier” of a bank is exempt, but a “teller” of the bank is not. Bookkeepers, secretaries, and “clerks of various kinds hold[ing] the run-of-the-mine [sic] positions in any ordinary business” are not exempt. A “tax consultant” for a company or for a “firm of consultants” is exempt. A “messenger boy,” even when he or she is “entrusted with carrying large sums of money,” is not exempt. A person “operating very expensive equipment” is not exempt. An “inspector,” including an “inspector for an insurance company,” is not exempt. A “statistician” who merely “tabulate[s] data” is not exempt, but a person who tabulates and “makes analyses of data and draws conclusions” that are “important” to a business is exempt. A “buyer” of equipment for an industrial plant or a retail establishment is exempt. (Former 29 C.F.R. § 541.205(c)(1), (2), (3), effective as of January 2001.)

In the end, “[t]he test of [the phrase] ‘directly related to management policies or general business operations’ is also met by many persons employed [in positions] as advisory specialists and consultants of various kinds, [including] credit managers, safety directors, claim agents and adjusters, wage-rate analysts, tax experts, account executives of advertising agencies, customers’ brokers in stock exchange firms, promotion men, and many others.” (Former 29 C.F.R. § 541.205(c)(5), effective as of January 2001.)

In Hodge, it was noted that the Cambridge claims adjusters’ duties and responsibilities in handling a claim from start to finish, overseeing discovery, retaining and overseeing outside counsel, determining and implementing litigation strategies, negotiating settlements, and setting reserves that averaged about $75,000 per case constituted activities “of substantial importance to the general business operations of the insurance-related entities.”  The court really focused on the claims adjusters’ ability to set reserves, noting that one five-person unit handled cases with aggregate reserves of $60 to $70 million.  The court noted testimony that the “adjusters’ decisions in setting reserves affect the finances of a client ‘dollar for dollar’ and affect a client’s business operations insofar as ‘committing of cash to one function takes it away from another.’  In short, the adjusters’ authority to set reserves is essentially equivalent to the authority to allocate and spend a company’s funds.”  (Hodge, p. 13)

Applying the language of Wage Order No. 4, the court found that “the claims adjusters were performing ‘office or non-manual work directly related to management policies or general business operations of his/her employer or his employer’s customers.’ The evidence developed at trial belies a conclusion that the adjusters’ duties and responsibilities are ‘restricted to the routine and unimportant’ as in Bell II.”  The appellate court agreed “with the trial court’s conclusion that the adjusters’ duties and responsibilities in setting reserves is of substantial importance to the general business operations of the insurance-related entities.  The court concluded that just because the plaintiffs might label themselves as working in unimportant roles does not necessarily mean that is so.  (Hodge, p. 18) Once again, this case demonstrates how important proper classification of employees is for employers. Further, in determining whether or not an employee is exempt, the courts will focus on the duties actually performed by the employee; job titles are essentially inconsequential in deciding whether or not an employee is exempt.

JAllan

Employee or Independent Contractor?

It’s a new year, and both the Department of Labor (DOL) and the IRS are intent on catching employee misclassification, that is whether a given person is an independent contractor and thus exempt from overtime and other hourly wage rules, or an employee.  This is a landmine of an area – particularly since slightly different tests are used by the IRS, under federal anti-discrimination laws and by the EEOC, under the federal Fair Labor Standards Act, and under California state law. 

In light of this, employers need to be meticulous about keeping records when interacting with independent contractors – make sure to keep itemized receipts for all work and expense reimbursements, and have signed contracts clearly laying out the term and extent of the project for which the independent contractor has been retained.  While each different entity and jurisdiction looks for something different, in all cases it comes down to a factual analysis that often has to meet the “pornography” test – you’ll know employment when you see it.  However, the courts typically focus on the following areas:

·         What degree of control does the employer have over work, and who exercises that control?

·         What is each party's level of loss in the relationship?

·         Who has paid for materials, supplies, and/or equipment?

·         What type of skill is required for work?

·         Is there a degree of permanence?

·         Is the worker an integral part of the business?

California Labor Code §2750.5 states that proof of independent contractor status includes the following factors:

    1. That the individual has the right to control and discretion as to the manner of performance of the contract for services in that the result of the work and not the means by which it is accomplished is the primary factor bargained for.

    2. That the individual is customarily engaged in an independently established business.

    3. That the individual’s independent contractor’s status is bona fide and not a subterfuge to avoid employee status.  A bona fide independent contractor status is further evidenced by the presence of cumulative factors such as substantial investment other then personal services in the business, holding out to be in business for oneself, bargaining for a contract to complete a specific project for compensation by project rather than by time, control over the time and place the work is performed, supplying the tools or instrumentalities used in the work other then the tools and instrumentalities normally and customarily provided by the employees, hiring employees, performing work that is not ordinarily in the course of the principal’s work, performing work that requires a particular skill, holding a license pursuant to the Business and Professions Code, the intent of the parties that the work relationship is of an independent contractor status, or that the relationship is not severable or terminable at will by the principal but gives rise to an action of breach of contract.

The language in subsection (c) somewhat mirrors the EEOC’s nonexhaustive sixteen factors under Title VII and other federal antidiscrimination laws:

·         The employer controls when/where/how the worker performs the job;

·         The work does not require a high level of skill or expertise;

·         The employer furnishes the tools, materials, and equipment;

·         The work is performed on the employer's premises;

·         There is a continuing relationship between the worker and the employer;

·         The employer has the right to assign additional projects to the worker;

·         The employer sets the hours of work and the duration of the job;

·         The worker is paid by the hour, week, or month rather than the job;

·         The worker does not hire and pay assistants;

·         The work performed by the worker is part of employer's regular business;

·         The employer is in business;

·         The worker is not engaged in his/her own distinct occupation or business;

·         The employer provides benefits such as health insurance or WC;

·         The employer withholds payroll taxes;

·         The employer can discharge the worker;

·         The worker and the employer believe that they have an employer-employee relationship.

Both the FLSA and the IRS use slightly simpler tests.  Under the FLAS, an “economic realities” approach is used – does the individual seem to be financially tied to the putative employer?  Specific elements include:

·         The degree of control exercised by the alleged employer;

·         The extent of the relative investments of the putative employee and employer;

·         The degree to which the alleged employee's opportunity for profit or loss is determined by the employer;

·         The skill and initiative required in performing the job;

·         The permanency of the relationship;

·         The degree to which the service is an integral part of the employer's business.

The IRS uses an 11 factor test, looking at three specific elements of the employment relationship:

Behavioral Control

·         Instructions the business gives the worker;

·         Training the business gives the worker.

Financial Control

·         The extent to which the worker has unreimbursed business expenses;

·         The extent of the worker's investment;

·         The extent to which the worker makes services available to the relevant market

·         How the business pays the worker;

·         The extent to which the worker can realize a profit or loss.

Type of Relationship

·         Written contracts describing the relationship the parties intended to create;

·         Whether the business provides the worker with employee-type benefits;

·         The permanency of the relationship;

·         The extent to which services performed by the worker are a key aspect of the regular business of the company.

Employers should thus be extra mindful of these various tests when classifying an individual as an independent contractor especially since the DOL and IRS are on cracking down on employers who misclassify their workers.

JAllan

Copyright 2011: FSK Publishing all Rights Reserved DISCLAIMER: The information on this blog is for general information purposes only and should not be construed to be formal legal advice nor should it be construed to create a lawyer/client relationship between the authors of any information on the blog and any individual who chooses to view this blog. Anyone accessing this blog is encouraged to seek independent counsel for any desired legal advice.

Litigation Is Similar To Democracy

Litigation is similar to democracy as defined by Winston Churchill. To paraphrase, the great man famously said that democracy is the worst form of government devised by the mind of man … except whatever is second. Litigation is similar. It is terribly inefficient, costly, uncertain and frustrating but so far we have yet to find a more just way of resolving intractable disputes.  Sometimes an employer is given no choice but to litigate and ultimately try its case.

An example of this is found in the recent case of Urga v Redlands Community Hospital, which was tried to a jury in San Bernardino County Superior Court in July 2010. Urga and others in this class action contended that in 1999 Redlands Community Hospital adopted a new program in which its twelve hour shift employees would start receiving overtime for shifts lasting more than eight hours.  The new program was prompted by a change in the law on January 1, 2000 requiring overtime pay after eight hours.  Previously employees working overtime were paid straight time not time and a half.

In late 2004, three employees of the hospital filed a class action suit, alleging that the hospital had failed to pay overtime properly for the class certified period of 2000 to June 2007 and the three plaintiffs were certified by the court as representatives of all hospital employees similarly situated during that period. The plaintiffs argued that Redlands never paid the overtime properly and the defense argued Redlands had paid properly, but even if it had not the most it owed was $93,000.

In discovery and pleadings the class argued it was entitled to $23,000,000 and the class’s lawyer argued to the jury they should award $51,000,000.

The result?  The jury awarded $93,000.

San Bernardino is a conservative jurisdiction, that is, jury panels tend to be pro-business, anti-give away, and that was a part of the decision to take the case to trial. The trial judge, Janet M. Frangie, was appointed by California governor Gray Davis, a democratic, who is noted for consensus building and for scholarship. The ultimate decision was of course based on the plaintiffs’ pre-trial demand.  The hospital could not negotiate a reasonable settlement in the face of the millions of dollars demanded.

For employers, sometimes trial may be the only answer.

NBoxley

Governor Signs Two Employment Related Bills

As the Governor is preparing to make his exist, he has signed into law a couple of bills that employers need to be aware of:

The first provides exemptions from state meal period requirements for certain types of employees, thus allowing employers to avoid one of the more common wage and hour pitfalls. The jobs covered are construction workers, commercial drivers, security officers, gas and electrical corporation employees, and public utility employees. The exemption applies only if the given employees are covered by a collective bargaining agreement that otherwise provides for meal periods and provides for binding arbitration of disputes concerning the application of meal periods.  The rationale behind this is that certain jobs require constant working, or make it impractical to regularly schedule meal periods in compliance with California law.

Another law recently passed provides for mandatory paid time off for employees donating an organ or bone marrow.  This law only applies to employers with 15 or more employees.  Employees are entitled to up to 30 days paid time off per year for donating an organ, and up to 5 days paid time off per year for donating bone marrow.  The employer can require the use of up to two weeks of accrued sick or vacation leave for organ donation, or up to 5 days for bone marrow donation, before providing the paid time off.  However, the periods of paid time off do not run concurrently with FMLA or CFRA, and the employee can still apply for those leaves.

One final update on the Brinker case. This is the case, now pending before the California Supreme Court, which addresses whether under California law an employer has the duty to ensure that employees take their meal and rest breaks, or alternatively to only provide the employees with the opportunity to take their meal and rest breaks. It looks like the Supreme Court is going to wait until after the election and the seating of a new Chief Justice before scheduling oral arguments.  At this time we do not expect a ruling before the end of the first quarter of 2011. Plaintiff’s attorneys all believe that the Court will go with the “ensure” standard; defense attorneys all think the Court will go with the “provide” standard.  We will keep you posted.

JAllan

Are Volunteers “Employees” Under FEHA?

In a just released decision denying in part the defendant’s motion to dismiss, a Federal District Court Judge for the Eastern District of California applied elements of California workers’ compensation law to find that a volunteer intern in a program run by the Nevada County Sheriff’s Department is an employee, and can pursue a lawsuit under Fair Employment and Housing Act (FEHA) for alleged sexual harassment.  In  the ruling released on October 21^st in Neronde v. Nevada County (2:10-cv-0776-JFM), the judge agreed that normally volunteers are not considered employees, noting that “compensation of some sort is indispensable to an employment relationship under the FEHA and that persons who receive no direct or indirect financial benefit for their services are not ‘employees’ for FEHA purposes.”  For workers’ compensation purposes, this is codified in California Labor Code Sec. 3352, which excludes volunteers and others who do not receive payment for their work from workers’ compensation.  Despite this code section, in Barragan v. Workers' Compensation Appeals Bd., 195 Cal. App. 3d 637 (Cal. Ct. App. 1987), the court found that a student volunteer intern at a hospital was an employee for the purposes of workers’ compensation, because in return for his time and labor, the student received valuable training, as well as course credit.

In denying the defendant’s motion for dismissal the judge agreed with the plaintiff’s argument that “FEHA intends to protect a broad class of individuals under its sexual harassment laws. In line with this intent for greater inclusion, the court holds that the definitions of ‘employee’ and ‘volunteer’ under California's workers' compensation laws should be construed with the purpose of the FEHA. In doing so, the court finds that plaintiff received credits toward graduation and community college and she learned invaluable skills in exchange for her services. Pursuant toBarragan, the court finds that plaintiff was an employee at the time of the alleged incident.”

It is unknown at this time whether the defendant will appeal the denial of the motion to dismiss.  This ruling does not mean that the defendant violated FEHA, only that the case may proceed to trial on the merits.  In Neronde the plaintiff claimed numerous causes of action including sexual harassment.  However, the court dismissed her other claims with prejudice because she failed to timely file her complaint.  The FEHA claim survived, however, as it has a longer statute of limitations. 

What this means for employers, besides the general proposition that employers cannot tolerate sexual harassment against anyone in the workplace, including volunteers, is that they may be subject to liability under the FEHA for volunteers even though they are not “employees.” The question is, do employers have to offer volunteers other protections afforded by FEHA, such as a reasonable accommodation to a volunteer suffering from a disability, or face potential under FEHA?  It seems to me, based on this decision, that the world of potential employees may have been significantly expanded.

 JAllan