Navigating Complex Leave and Disability Issues in California

Navigating Complex Leave and Disability Issues in California Presented By Jenna H. Leyton-Jones, Esq. 11622 El Camino Real, Suite 300 San Diego, CA 92130 jleyton@pettitkohn.com (858) 755-8500

TABLE OF CONTENTS NAVIGATING COMPLEX LEAVE AND DISABILITY ISSUES IN CALIFORNIA... 1 I. Statutory Schemes With Maximum Leave Entitlements... 1 A. California Family Rights Act ( CFRA ) [Cal. Gov. Code 12945.1 et seq.]... 1 B. Family and Medical Leave Act ( FMLA ) [29 U.S.C. 2601 et seq.]... 1 C. Pregnancy Disability Leave Law ( PDLL ) [Cal. Gov. Code 12945].. 1 II. Statutory Schemes Without Defined Leave Entitlements... 2 A. Fair Employment and Housing Act [Cal. Gov. Code 12940 et seq.]... 2 B. Americans with Disabilities Act [42 U.S.C. 12101 et seq.]... 2 III. New Disability Discrimination Regulations (effective January 1, 2013)... 3 IV. Leave as a Reasonable Accommodation /Indefinite Leaves... 4 V. Honest Belief Defense... 4 VI. Pregnancy-Related Issues... 5 A. New Pregnancy Regulations (effective January 1, 2013)... 5 B. Benefits... 6 C. Notice... 6 D. Sanchez v. Swissport (2013) 213 Cal.App.4th 1331... 7 E. New Breastfeeding Law (effective January 1, 2013) (AB 2386-Allen).. 7 VII. Interplay Between Workers Compensation and Employer s Other Statutory Duties... 7 VIII. Effect of DOMA and Prop 8 Decisions on Leave Entitlements in California... 8 A. Windsor v. Estate of Spyer... 8 B. Hollingsworth v. Perry... 8 IX. Best Practices for Administering Leave and Providing Reasonable Accommodations... 8 i

NAVIGATING COMPLEX LEAVE AND DISABILITY ISSUES IN CALIFORNIA I. Statutory Schemes With Maximum Leave Entitlements A. California Family Rights Act ( CFRA ) [Cal. Gov. Code 12945.1 et seq.] 1. California law that permits eligible employees to take up to a total of 12 workweeks of leave in any 12-month period for family and medical leave. 2. Leave can be used after the birth of a child for purposes of baby bonding; after placement of a child in the employee s family for adoption or foster care; for the employee s own serious health condition; or for the serious health condition of the employee s child, parent, spouse or registered domestic partner. 3. Cannot be used for employee s pregnancy-related or childbirth-related disabilities. 4. Applies to employers with 50 or more employees. 5. No undue burden defense. 6. Requires reinstatement to the same or comparable position. B. Family and Medical Leave Act ( FMLA ) [29 U.S.C. 2601 et seq.] 1. Federal law that permits eligible employees to take a total of 12 workweeks of leave during any 12-month period for reasons similar to CFRA leave. 2. Unlike CFRA, includes the employee s pregnancy-related or childbirthrelated disabilities. 3. Unlike CFRA, does not apply to registered domestic partners. 4. Applies to employers with 50 or more employees. 5. No undue burden defense. 6. Requires reinstatement to the same or comparable position. C. Pregnancy Disability Leave Law ( PDLL ) [Cal. Gov. Code 12945] 1. Part of CFRA that is only applicable to employee s pregnancy-related or childbirth-related disabilities. 1

2. Permits employee to take leave for up to 4 months and thereafter return to work. a. New regulations interpret 4 months as one-third of a year, or 17 and 1/3 weeks of leave. 3. Is available in addition to any leave entitled under CFRA. 4. Applies to employers with 5 or more employees. 5. No undue burden defense. 6. Requires reinstatement to the same (not just comparable) position. II. Statutory Schemes Without Defined Leave Entitlements A. Fair Employment and Housing Act [Cal. Gov. Code 12940 et seq.] 1. California law that prohibits employers from discriminating against individuals with disabilities (along with 12 other enumerated characteristics). 2. Requires employers to provide reasonable accommodation for applicants or employees who, because of disability, are unable to perform the essential functions of the job. 3. Requires employers to engage in a timely, good faith interactive process with applicants or employees in need of reasonable accommodation. 4. Does not specifically define reasonable accommodation, which can include job restructuring, modifying work schedules, modifying equipment, or providing leave. 5. Applies to employers with 5 or more employees. 6. Allows employers to permissibly refuse to accommodation employee s request for accommodation because such accommodation would create an undue hardship to the operation of the employer s business. B. Americans with Disabilities Act [42 U.S.C. 12101 et seq.] 1. Federal law that prohibits employers from discriminating against individuals with disabilities. 2. Requires employers to provide reasonable accommodation for applicants or employees who, because of disability, are unable to perform the essential functions of the job. 2

3. Requires employers to engage in a timely, good faith interactive process with applicants or employees in need of reasonable accommodation. 4. Does not specifically define reasonable accommodation, which can include job restructuring, modifying work schedules, modifying equipment, or providing leave. 5. Applies to employers with 15 or more employees. 6. Allows employers to permissibly refuse to accommodation employee s request for accommodation because such accommodation would create an undue hardship to the operation of the employer s business. III. New Disability Discrimination Regulations (effective January 1, 2013) 1. Expand definition of disability (both mental and physical), and indicate that the term should be broadly construed. [2 Cal. Code Regs. 7293.6] 2. Perceived Potential Disability is now a disability and is defined as being regarded as or perceived as having a disease, disorder, or condition that has no present disability effect, but may become a mental or physical disability. [2 Cal. Code Regs. 7293.6] 3. Lay out a lengthy illustration of the interactive process and the obligations of both employer and employee/applicant, including the employee/applicant duty to provide medical certification and the possible repercussions for failing to do so. [2 Cal. Code Regs. 7294.0] 4. Prohibit genetic testing. [2 Cal. Code Regs. 7294.3] 5. Expand definition of health care provider. [2 Cal. Code Regs. 7293.6] 6. Provide more detail on medical and psychological inquiries and examinations, as well as qualification standards and tests. They clarify that (1) an employer may not ask for an examination or make any medical inquiry before a bona fide offer of employment is made, and (2) the bona fide offer of employment may be conditioned on completion of a fitnessfor duty exam (provided all employees in similar positions must take the exam). During employment or prior to employment, exams and inquiries are permissible only if they are job-related and consistent with business necessity. [2 Cal. Code Regs. 7294.2, 7294.3] 7. Provide examples of what may be a reasonable accommodation, such as allowing the use of assistive animals (also newly defined), modifying an employer policy, permitting an employee to work from home, reassigning to employee to vacant position, or providing more leave than would otherwise be required by CFRA or FMLA. [2 Cal. Code Regs. 7294.3.9] 3

a. Paid or unpaid leaves of absence. When the employee cannot presently perform the essential functions of the job, or otherwise needs time away from the job for treatment and recovery, holding a job open for an employee on a leave of absence or extending a leave provided by the CFRA, the FMLA, other leave laws, or an employer s leave plan may be a reasonable accommodation provided that the leave is likely to be effective in allowing the employee to return to work at the end of the leave, with or without further reasonable accommodation, and does not create an undue hardship for the employer. When an employee can work with a reasonable accommodation other than a leave of absence, an employer may not require that the employee take a leave of absence. An employer, however, is not required to provide an indefinite leave of absence as a reasonable accommodation. [2 Cal. Code Regs. 7294.3.9(c)] IV. Leave as a Reasonable Accommodation /Indefinite Leaves New disability regulations explicitly provide that extending leave provided for by FMLA/CFRA may be a reasonable accommodation when the leave is likely to be effective in allowing the employee to return to work at the end of the leave, with or without further reasonable accommodation, and does not create an undue hardship for the employer. [2 Cal. Code Regs. 7294.3.9(c)] 1. SO, employers cannot just discharge an employee who is unable to return to work at the end of FMLA/CFRA leave. 2. However, employers are not required to provide indefinite leave. [2 Cal. Code Regs. 7294.3.9(c)] Rodriguez v. Valley Vista Services, Inc. -- $21.7 million verdict against employer that fired employee on leave for panic attacks. Employee contended that employer failed to communicate with her during her leave, and that her claim of disability was met with skepticism. Employer contended that employee had abandoned her job. V. Honest Belief Defense Richey v. AutoNation, Inc. California Court of Appeal holds that employer could rely on its honest belief that employee was abusing CFRA leave. Although employer could have legally discharged employee for misusing approved leave, the employer could not simply rely on an imprecisely worded and inconsistently applied company policy to terminate an employee on CFRA leave without adequately investigating and developing sufficient facts to establish the employee had actually engaged in misconduct warranting dismissal. In other words, the employer was required to prove with evidence that the employee was abusing his or her leave before taking adverse employment action against him. [NOTE: This case is currently on appeal to the California Supreme Court and has no precedential value unless/until the Supreme Court affirms the decision.] 4

VI. Pregnancy-Related Issues A. New Pregnancy Regulations (effective January 1, 2013) 1. Perceived pregnancy is now protected. [2 Cal. Code Regs. 7291.2] a. Perceived pregnancy is defined as being regarded or treated by an employer as being pregnant or having a related medical condition. b. Specify that leave, reasonable accommodation, transfers, and continuation of benefits are only obligatory for actual pregnancy. 2. Defines 4 months as one-third of a year, or 17 and 1/3 weeks. [2 Cal. Code Regs. 7291.2] 3. Definition of disabled by pregnancy is expanded to include, among other things, needing time off for prenatal or postnatal care, bed rest, or recovery from childbirth or loss or end of pregnancy. [2 Cal. Code Regs. 7291.2] 4. A reasonable accommodation must be granted if the accommodation is medically advisable and reasonable. [2 Cal. Code Regs. 7291.7] 5. Even if an accommodation is granted, it does not affect the employee's independent right to take up to four months for a pregnancy disability leave unless the accommodation is a reduction in hours, in which case it may be deducted from the four-month leave entitlement. [2 Cal. Code Regs. 7291.7] 6. PDL may be accounted for in increments of no greater than one hour and must be accounted for in the shortest increment that the employer uses to account for use of other forms of leave (if the same is less than one hour). [2 Cal. Code Regs. 7291.9] 7. If an employer has a more generous leave policy, it must be applied to pregnancy disability leave. [2 Cal. Code Regs. 7291.9] 8. An employee can request, and the employer must provide, a written guarantee of reinstatement. [2 Cal. Code Regs. 7291.10] 9. The only defense for denial of reinstatement is that the employee would not have been employed at the same position regardless of the leave (the DFEH deleted the defense that reinstating the employee would substantially undermine the employer's ability to operate the business safely and efficiently ). [2 Cal. Code Regs. 7291.10] 5

B. Benefits C. Notice 1. Benefits must be continued during the entire leave on the same terms as if the employee were still working. [2 Cal. Code Regs. 7291.11] a. If the employer pays 100% of the cost of benefits, the company will need to continue to pay the full cost during PDL. b. If the employee contributes towards the cost of her coverage, she can be required to continue making these payment contributions during the leave. c. If the employee fails to return from a PDL leave, the employer may recoup the cost of the employer premiums paid during the leave, unless the reason for the employee's failure to return is the result of a continuing disability, due to the employee taking additional protected leave under CFRA, or other circumstance beyond her control. 2. New regulations do not affect benefits continuation under CFRA. a. Thus, if employee takes full 17 and 1/3 weeks of PDL and 12 weeks of CFRA for baby bonding, employer must continue benefits for 29 and 1/3 weeks. 1. There are new employee notices, and new rules regarding distribution of notice. [2 Cal. Code Regs. 7291.16] a. Reasonable advance notice must include information about: i. an employee s right to request reasonable accommodation, transfer, or pregnancy disability leave; ii. iii. employees notice obligations to provide adequate advance notice to the employer of the need for reasonable accommodation, transfer or pregnancy disability leave; and the employer s requirement, if any, for the employee to provide medical certification to establish the medical advisability for reasonable accommodation, transfer, or pregnancy disability leave. 2. Failure to provide notice precludes an employer from taking any adverse action against the employee. [2 Cal. Code Regs. 7291.16] 6

D. Sanchez v. Swissport (2013) 213 Cal.App.4th 1331 1. When pregnancy disability leave ends under the PDLL but employee is still unable to return to work, the employer must engage in an interactive process and, unless it can show undue hardship, provide the employee with extended leave as a reasonable accommodation under FEHA. E. New Breastfeeding Law (effective January 1, 2013) (AB 2386-Allen) 1. Amended existing statutory definition of sex under the FEHA to include breastfeeding or medical conditions related to breastfeeding. 2. Impetus was California DFEH v. Acosta Tacos, wherein female employee who had just returned from PDL was fired for nursing her infant during her lunch break. a. Fair Employment and Housing Commission ruled that the taco company had denied the employee the right to a discriminationfree work environment based on sex or pregnancy under the FEHA even though breastfeeding wasn t specifically mentioned as being classified under sex discrimination. 3. May prohibit employers from reassigning employees to other work, requiring employees to work different shifts, or requesting employees to take additional leave. VII. Interplay Between Workers Compensation and Employer s Other Statutory Duties Cuiellette v. City of Los Angeles (2011) 194 Cal. App. 4th 757--$1.5 million verdict against LAPD, which fired officer who received 100% total permanent disability rating in a workers compensation proceeding. Court found that even if the officer could not perform all of the essential functions of a police officer, he could perform the essential functions of the court desk position into which he had initially been placed by the police department as a reasonable accommodation, and as such, his subsequent discharge violated the FEHA. According to the court, the relevant inquiry was whether the officer was able to perform the essential duties of the light duty assignment he was given on his return to work and not whether he was able to perform all of the essential duties of a police officer in general. Lesson: Regardless of employee s workers compensation status, employer must undertake an independent analysis of an employee's medical restrictions and limitations before concluding that the employee cannot be accommodated under ADA/FEHA. 7

VIII. Effect of DOMA and Prop 8 Decisions on Leave Entitlements in California A. Windsor v. Estate of Spyer U.S. Supreme Court ruled that Defense of Marriage Act ( DOMA ) a federal law passed in 1996 that defined marriage and spouse as excluding same-sex partners -- is unconstitutional. Effect: Same-sex couples who are legally married pursuant to state law are entitled to equal benefits under federal law that are provided to all other married couples. However, the Court s ruling does not require states to legalize same-sex marriage. B. Hollingsworth v. Perry U.S. Supreme Court ruled that the petitioners a group of individuals who oppose samesex marriage and had asked the Court to determine whether the Equal Protection Clause prohibits California from defining marriage as the union of a man and woman did not have standing the bring their lawsuit. Effect: Leaves in place the lower court s decision, which found Proposition 8 -- a ban on gay marriage passed by California voters in 2008 -- to be unconstitutional and therefore unenforceable. Effectively legalizes gay marriage in California. Overall, Windsor and Hollingsworth rulings are unlikely to have significant impact on leave administration in California since CFRA already extended leave benefits to registered domestic partners. Notably, same-sex unmarried couples may enjoy greater leave benefits than married same-sex couples since FMLA does not extend benefits to registered domestic partners. IX. Best Practices for Administering Leave and Providing Reasonable Accommodations a. Ensure that all required leave notices are timely provided. b. Confirm in writing when FMLA/CFRA leave will be exhausted. c. If FMLA/CFRA leave is exhausted and employee still hasn t returned to work, engage in interactive process to determine if additional leave is appropriate reasonable accommodation under ADA/FEHA. d. If extended leave is an appropriate reasonable accommodation, inform the employee in writing that employer will continue to provide leave, but cannot guarantee that job position will be available if/when employee is able to return o work. e. Continue to communicate with employee regarding work status every 30 to 60 days. Document these attempts. 8

i. Make several attempts in various forms (telephone calls, e-mails, letters) to communicate with uncommunicative employees. f. Update policies/handbooks to ensure that they are consistent with new laws/regulations. g. Make sure job descriptions are up-to-date and accurate. h. Educate managers regarding employee rights. i. Conduct a thorough investigation and gather evidence when employee abuse of leave is suspected. Do not rely on suspicions, hearsay, etc. j. Ensure that duties under FMLA/CFRA/ADA/FEHA are complied with even when employee is temporarily/permanently disabled for purposes of workers compensation. 9