Keller & Heckman: Wrongful Termination: Mixed Motives and Damages in California (Harris v. City of Santa Monica)

Keller & Heckman: Wrongful Termination: Mixed Motives and Damages in California (Harris v. City of Santa Monica)

I. THERE ARE MOTIVATIONS AND THEN THERE ARE MOTIVATIONS

The Supreme Court of California recently addressed a challenging issue associated with employee wrongful termination actions. The Supreme Court considered the situation where an employee establishes a discriminatory motivation and the employer shows, by a preponderance of the evidence, a legitimate, contemporaneous motivation for the employee's discharge. The Court grappled with the legislative purpose underpinning California's Fair Employment and Housing Act and an employer's right to fire underperforming employees.

The Court, in Harris v. City of Santa Monica,[1] held that in the situation where an employee can show that her termination was partially motivated by discrimination, and the employer can show a legitimate motive for the termination, the employee is not entitled to damages or reinstatement, but may be awarded declaratory or injunctive relief and reasonable attorney's fees.

II. EVERYBODY HAS THEIR REASONS

In Harris a city bus driver was terminated shortly after she informed her supervisor that she was pregnant. The employer produced evidence that the driver, who was on probation, was terminated for cause - she had two accidents and on two occasions she failed to inform her dispatcher that she would be late for her shift.

The court recognized the well-established burden-shifting process aimed at "ferret[ing] out the 'true' reason for the employer's action." However, the court also recognized that this analysis is inappropriate where a plaintiff alleges that the employer harbored mixed motives for the termination where "there is no single 'true' reason for the employer's action." In other words, where an employer allegedly terminated an employee for a mix of legitimate and discriminatory reasons, a plaintiff should not have the burden of proving that the legitimate reason is merely a pretext.

III. WHAT DOES "BECAUSE OF" REALLY MEAN

The California Fair Employment and Housing Act (FEHA) prohibits, among other things, an employer from discriminating against a person because of race, religion, national origin, disability, gender, age, or sexual orientation. The Court first looked at the California Legislature's intent and focused on the term "because of." The Court noted that this phrase requires some level of causation. The court then focused on the "kind or degree of causation" required by that term.

The court considered three possible interpretations of "because of" causation: (1) where the employer would not have terminated the employee 'but for' its discriminatory motive; (2) the discriminatory motive was a "substantial factor" in the termination decision; and (3) the discrimination was merely a "motivating factor" in the employer's decision. Finding no persuasive guidance from California's legislative history or case law, the Court looked to the U.S. Supreme Court's interpretation of 'because of' contained in the context of Title VII.

IV. HOW ABOUT SAME-DECISION ANALYSIS

After a labored analysis of federal antidiscrimination law, the Court returned to the California Legislature's purpose behind FEHA. The Court noted that a same-decision showing requires proof by the employer that, in the absence of any discrimination, it "would have made the same decision at the time it made its actual decision," and not just that the same decision could have been otherwise justified after the fact.

A. COMPLETE DEFENSE TO LIABILITY?

Considering the legislative intent of "preventing and deterring unlawful discrimination," the Court found that a defendant's same-decision showing will not be a complete defense to liability where the plaintiff establishes that discrimination was also a substantial factor in the employer's decision. The Court also added, "mere discriminatory thought or stray remarks are not sufficient to establish employer liability."

B. DAMAGES FOR SUBSTANTIALLY DISCRIMINATORY MIXED-MOTIVE TERMINATIONS

The Court walked a fine line, promoting the FEHA's intention of discouraging discriminatory practices, while balancing an employer's right to terminate an underperforming employee.

The Court rejected the plaintiff's position that she should be reinstated and awarded back pay as well as compensation for her economic losses based on a showing that discrimination was one of several motivating factors - at least where the employer established that it also had a non-discriminatory purpose. The Court reasoned that if the employee would have been discharged anyway, reinstatement and back pay would constitute a windfall and could have a chilling effect on employers. The Court drew a similar conclusion with regard to non-economic losses.

Nonetheless, the Court did not allow the City to avoid all consequences of its allegedly partially discriminatory act. To do so would circumvent the FEHA's purpose. The Court held that an employment decision substantially motivated by discrimination might warrant declaratory relief in the form of a judicial declaration of employer wrongdoing under Cal. C. Civ. Proc. § 1060. Such a declaration would address some of the emotional injuries by "reaffirming the plaintiff's equal standing among her coworkers and community, and condemn the discriminatory policies or practices." The courts could also then grant injunctive relief to prevent recurrent discriminatory conduct. But most significant is that a plaintiff, who makes a showing that discrimination was a substantial factor motivating the employer's termination decision, may be entitled to reasonable attorney's fees. Under the facts of Harris, attorney's fees exceeded the jury's damages award: the jury had awarded Harris $177,905 in actual damages and $150,000 for non-economic losses but the trial court awarded her $401,187 in attorney's fees.

The Court's decision does not preclude the possibility that an employer can achieve a complete defense by showing that it had purely legitimate reasons for discharging an employee. If, however, a plaintiff establishes that discrimination was also a substantial motivating factor, the employer may enter proof that it would have made the same decision absent such discrimination and thereby preclude an award for damages, backpay or reinstatement.


[1] Harris v. City of Santa Monica, Case S181004, (Cal. Sup. Ct., Feb. 7, 2013)

For more information about LexisNexis products and solutions connect with us through our corporate site.