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1 Employment Law Commentary Volume 18, No. 4 April 2006 Nothing Is Forever: The Ability of Employers to Terminate Employees with Industrial Injuries After Lauher By Hiroki Suyama In 2003, the California Supreme Court in Department of Rehabilitation v. Workers Compensation Appeals Board (Lauher) 1 raised the standard an employee must meet to make a prima facie case under Labor Code section 132a, which forbids discrimination against employees for filing or making known an intention to file a workers compensation claim. Remedies for a violation of section 132a include damages up to $10,000 and reinstatement. Prior to Lauher, an employee could meet his or her burden of making a case of discrimination by merely showing that his or her employer engaged in conduct detrimental to the employee as a result of an industrial 2 An employee was not, however, required to prove actual discrimination. Under this liberal standard, an employer risked a 132a violation for any unfavorable conduct against any employee who suffered or claimed an industrial injury, and many employers were reluctant to ever terminate an industrially injured employee, regardless of the length of the employee s leave or the extent of the employee s work restrictions. Lauher established a new and higher standard for an employee to make a prima facie showing of discrimination under 132a. In Lauher, the employee, Ronald Lauher, claimed that his employer discriminated against him in violation of 132a because the employer insisted that he use his accumulated sick and vacation leave for the time he was out of the office seeking medical treatment for his industrial injury, and was therefore treated differently from other employees who had not sustained an industrial The California Supreme Court found no violation of 132a, and held that an employee pursuing a discrimination claim under 132a not only must show that his or her employer s action worked to his or her detriment, but also must show that he or she had a legal right to receive or retain the deprived benefit or status, and the employer had a corresponding legal duty to provide or refrain from taking away that benefit or status. 3 In addition, the California Supreme Court held that an employee must show actual discrimination by proving that he or she was singled out
2 employment law commentary for disadvantageous treatment because of the industrial injury or treated differently from other employees in the same situation. 4 The California Supreme Court concluded that Lauher was not deprived of any entitlement because all employees were required to use their sick leave when away from work for industrial and non-industrial medical treatment. In addition, Lauher was not singled out for disadvantageous treatment because there was no evidence that other employees who were permitted to leave the office for medical appointments related to nonindustrial injuries were not required to use their sick leave. Lauher was welcomed by employers, but many employers did not know how this new standard would be applied. This article examines how the new standard has been applied in 132a discrimination cases tried before a Worker s Compensation Judge ( WCJ ) and reviewed by the Workers' Compensation Appeals Board ( WCAB ) since Lauher. Gallant v. Workers In Gallant v. Workers Compensation Appeals Bd., 5 petitioner, Paul Gallant, sustained industrial injuries to his neck, right major shoulder, and upper back while employed as a deli clerk for Vons Companies. After a period of temporary disability, on December 28, 2000, Gallant was allowed to return to work by his primary treating physician with restrictions on heavy lifting, work above shoulder level with the right arm, pushing or pulling with the right arm, and using the right arm as an assist only. However, Gallant was told by Vons that there were no alternative positions available that satisfied his work restrictions. On January 15, 2001, Gallant filed a petition under 132a alleging that Vons had a duty to accommodate his work restrictions by reinstating him to an available alternative position. On April 2, 2001, Gallant was returned to work as a cashier at a different store. Shortly after returning to work, Gallant returned to his primary treating physician to report increased pain in his right shoulder and neck pain as a result of his new duties as a cashier. Gallant was placed on temporary disability but was released to return to work on May 23, 2003, on a trial basis with increased work restrictions of no heavy lifting, no repetitive bending, no pushing and pulling, and no lifting of more than 25 pounds. Vons refused to allow Gallant to return to work based on the new work restrictions. On May 29, 2003, Gallant filed a supplemental petition under 132a alleging that Vons s refusal to return him to work was discriminatory. In June 2003, Gallant suffered a non-industrial injury to his left wrist. Gallant was subsequently evaluated by a Qualified Medical Examiner ( QME ) who imposed numerous work restrictions but stated that Gallant could return to his position as a cashier. On September 1, 2003, Vons reinstated Gallant to his position as a cashier. The Worker s Compensation Judge (WCJ) found two violations of 132a. First, the WCJ found that the three month delay in returning Gallant to work between December 28, 2000, and April 2, 2001, was a violation of 132a because Vons did not offer any explanation for the delay in finding the cashier position for Gallant. Second, the WCJ found that the delay between the June 2003 QME report allowing Gallant to return to work as a cashier and Gallant s actual return to work on September 1, 2003, was a violation of
3 m o r r i s o n & foerster llp 132a because there was no reasonable explanation for the delay. The WCAB granted Vons s petition for reconsideration and reversed the WCJ s findings of discrimination. Relying on Lauher, the WCAB held because Vons provided Gallant with a modified position, Gallant had the burden to prove that he had a legal right to the modified job within less time than the job was provided and that Vons had a legal duty to provide the modified job within less time than it did. The WCAB concluded that Gallant failed to meet his burden of proof as set forth in Lauher. The WCAB also noted that an employer is allowed a reasonable time to modify a job or help find modified duties for an injured worker to perform, and that Vons did not have a legal duty to search all of its 325 stores for a cashier position. Micevski v. Workers In Micevski v. Workers Compensation Appeals Bd., 6 petitioner George Micevski suffered an industrial injury to his right ankle and leg while working as a stage technician for CBS Broadcasting, Inc. Micevski was disabled from July 27, 1998, to December 2, 1999, when he was released to return to work with work restrictions by his treating physician. Micevski returned to his regular duties in December 1999, but was given the status of a daily call-back worker because the position of weekly callback worker was unavailable. The change in status was a demotion for Micevski and resulted in a loss of seniority. Micevski was later laid off on March 28, On May 9, 2000, Micevski filed a petition under 132a alleging discrimination. The WCJ found that CBS violated 132a by changing Micevski s work status from weekly call-back to daily call-back after his return to work because the change in status resulted in a demotion and loss of seniority which ultimately led to Micevski s lay-off on March 28, The WCJ also noted that CBS had failed to show that Micevski s change in status upon his return to work was due to a business necessity. The WCAB granted CBS s motion for reconsideration and reversed the WCJ s finding of discrimination. The WCAB found that Micevski s lay-off was not the result of his change in status, but the result of a newly issued medical report that gave CBS doubt as to whether Micevski could continue to perform his job duties. The WCAB also noted that the WCJ had failed to perform the analysis under Lauher. According to the WCAB, Micevski did not meet his burden of proving discrimination under 132a under Lauher because he failed to show he had a legal right to be returned to weekly call-back status, or that that he was singled out for disadvantageous treatment because of his industrial Robinson v. Workers In Robinson v. Workers Compensation Appeals Bd., 7 the petitioner, Elenora Robinson, sustained an industrial injury to her lower back while working as a welder for Siemens Dematic Corporation on April 27, Robinson initially obtained medical treatment through a health care provider selected by Siemens, then sought medical treatment from Kaiser Permanente. Kaiser issued an Industrial Visit Verification form which stated that Robinson was to remain off work until August 15, 2001, at which time she could return to modified duty that would preclude her from performing her usual work as a welder.
4 employment law commentary Robinson was scheduled to return to Kaiser on August 9, 2001, but did not appear for her appointment. Robinson informed Siemens that she was seeking treatment from a different provider and would provide certification from the new provider when she received it. Robinson did not return to work on or after August 15, 2001, nor did she provide any medical certification for her absence. Siemens terminated Robinson s employment effective August 17, 2001, based on its policy to discharge employees after a three-day period of absence from work without informing Siemens of the reason for the absence. Robinson filed a petition under 132a alleging discrimination by refusing to offer her modified work and thereby constructively terminating her employment. Robinson also alleged that Siemens violated 132a by terminating her for failing to contact Siemens and provide medical certification for her absences. Applying Lauher, the WCJ held that Robinson failed to prove discrimination under 132a. Robinson did not keep Siemens informed of her status and did not provide medical certification substantiating her absence from work, and Siemens terminated Robinson in a manner consistent with Siemens s policy regarding employee absences without medical certification. There was no discrimination against Robinson because the policy was applied equally to all employees who were absent from work on medical leave due to industrial and nonindustrial injuries. Daimler Chrysler Corp. v. Workers Compensation Appeals Bd. In Daimler Chrysler Corp. v. Workers, 8 petitioner, Marcus Freeman, sustained an industrial injury to his head and neck while working as a loader for Daimler Chrysler Corporation. Freeman sought treatment on October 2, 2000, and received work restrictions requiring him to be put on light duty. However, Freeman was told by his supervisor that there was no light duty available and that he could return to work when he was released without restrictions. On November 21, 2000, Freeman received notice to report to his workplace with proper documentation, and that if he did not, his seniority would be terminated. On December 18, 2000, Freeman provided documents showing that he could return to work without restriction. Subsequently, Freeman was advised that he had to supply the original documentation from his doctor by January 12, 2001, or he would be permanently terminated. Freeman provided the original documentation in his possession that consisted of pink carbon copies. Freeman was told that the documentation was insufficient because the human resources supervisor felt that the documentation was tampered with by Freeman. Freeman was terminated based on his absence from work without proper documentation. Freeman filed a petition under 132a alleging that he had been terminated as a result of his industrial The WCJ found that Daimler violated 132a. According to the WCJ, Freeman had met the burden of proving unlawful discrimination under Lauher because he showed that he was terminated despite complying with everything that was asked of him by Daimler. In addition, the WCJ found that the human resources supervisor s opinion that Freeman had tampered with the documentation was unsubstantiated, and that Daimler did not make sufficient efforts to contact the doctor to verify the documentation. Daimler filed a petition for reconsideration, arguing that Freeman failed to show under Lauher that he
5 m o r r i s o n & foerster llp had a legal right to receive or retain the deprived benefit because he had 107 work violations prior to being terminated. The WCJ had rejected this argument because Daimler never showed any connection between these violations and Freeman s termination, and the evidence showed that the termination was the result of Daimler s belief that Freeman had tampered with the documentation. The WCAB denied reconsideration and adopted the WCJ s report. Pate v. Workers In Pate v. Workers Compensation Appeals Bd., 9 petitioner, George Pate, sustained an industrial injury to his abdomen while working as an assembler/machine operator for Simpson Strong Tie on June 27, Pate sought medical treatment and was released for modified work. Pate returned to modified work on June 28, On July 24, 2001, Pate called in sick. On July 25, 2001, Pate left a voic message for his supervisor that he was in pain and would go see a doctor. Pate saw a doctor on July 26, 2001, and was given prescription pills and work restrictions. On July 27, 2001, Pate showed up for work. Pate was told by his supervisor that he would be terminated unless he brought a medical note. Pate failed to produce a medical note and was terminated. Pate filed a petition under 132a alleging discriminatory discharge due to absences resulting from the effects of his industrial Pate was evaluated by an Agreed Medical Examiner ( AME ) on April 30, The AME s report concluded that Pate was temporarily totally disabled on July 24, Pate s supervisor testified at trial that once it was established that Pate was disabled on the three days he was absent from work, Pate would be reinstated. The WCJ found Simpson liable for discrimination under 132a because Pate established that he was disabled, that his absence from his employment was because of the industrial injury, and that he was terminated due to his absence. The WCAB granted Simpson s petition for reconsideration and reversed the WCJ. The WCAB first stated that the legal right/duty analysis under Lauher did not apply in this case. Instead, the WCAB held that the discrimination claim was subject to a factual analysis as to whether, at the time of the termination of Pate, Simpson had a good-faith and substantiated belief that the termination was not based upon the industrial injury, but was rather related solely to Pate s three absences that had not been verified. The WCAB concluded that the reason for Pate s termination was his failure to get a note from the doctor stating that he was off three days due to medical reasons, regardless of whether the medical reason was industrial or non-industrial. The WCAB also stated that the relevant act was the employer s actions at the time they were taken. Thus, the fact that the WCJ subsequently found a period of temporary disability was irrelevant. The WCAB also noted that Simpson presented evidence that the termination was based solely on the lack of substantiation for the absences, that the policy was uniformly applied, and that Pate did not produce any evidence that Simpson s stated reason for the termination was a pretext to terminate Pate because of his industrial SUMMARY The Lauher case has made it more difficult for employees to prove 132a
6 employment law commentary This newsletter addresses recent employment law developments. Because of its generality, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations. Editor: Lloyd W. Aubry, Jr., (415) San Francisco Lloyd W. Aubry, Jr. (415) James E. Boddy, Jr. (415) James C. Paras (415) Linda E. Shostak (415) Palo Alto David J. Murphy (650) Eric A. Tate (650) Raymond L. Wheeler (650) Tom E. Wilson (650) Los Angeles Sarvenaz Bahar (213) Timothy F. Ryan (213) Janie F. Schulman (213) B. Scott Silverman (213) New York Miriam H. Wugmeister (212) Washington, D.C./Northern Virginia Daniel P. Westman (703) Orange County Robert A. Naeve (949) Steven M. Zadravecz (949) San Diego Rick Bergstrom (858) Craig A. Schloss (858) Denver Steven M. Kaufmann (303) Tarek F.M. Saad (303) London Ann Bevitt David C. Warner If you have a change of address, please write to Chris Lenwell, Morrison & Foerster llp, 425 Market Street, San Francisco, California , or him at clenwell@mofo.com Morrison & Foerster LLP. All Rights Reserved. discrimination claims. Employees can no longer rely merely on an industrial injury and an adverse action to prove their claim. Instead, employees must also show that they had a legal right to receive or retain the deprived benefit or status, that the employer had a corresponding duty to provide or refrain from taking away the deprived benefit or status, and that the employee was treated differently from other employees because of the industrial There are two lessons for employers from these cases. First, any adverse action taken against employees who have suffered or claimed an industrial injury should be based on a policy that is uniformly and equally applied to all employees. An employer should not attempt to rely on a policy that is typically unenforced or enforced inconsistently in order to take adverse action against an employee who has suffered or claimed an industrial Second, employers should document the basis on which any adverse action is taken against employees who have suffered or claimed an industrial As demonstrated in the Daimler Chrysler case, an employer cannot base an adverse action on one reason (e.g., failure to provide medical documentation), and later attempt to justify the adverse action on another reason (e.g., 107 work violations). On the other hand, as demonstrated in the Pate case, if the employer can show that it had a good-faith and substantiated belief that the adverse action was based on a violation of company policy at the time the adverse action was taken, any subsequent determination of the existence of temporary disability is irrelevant for purposes of discrimination Cal. 4th 1281, 1300 (2003). 2 Barns v. Workers Comp. Appeals Bd., 216 Cal. App. 3d 524, 531 (1989) Cal. 4th at Id Cal. Comp. Cas. (MB) 485 (Cal. App. 2d Dist. 2005) Cal. Comp. Cas. (MB) 252 (Cal. App. 2d Dist. 2005) Cal. Comp. Cas. (MB) 262 (Cal. App. 1st Dist. 2005) Cal. Comp. Cas. (MB) 1327 (Cal. App. 2d Dist. 2004) Cal. Comp. Cas. (MB) 1339 (Cal. App. 4th Dist. 2004) Hiroki Suyama is an associate in our Los Angeles office. He can be reached at (213) or hsuyama@mofo.com.
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