Lawson v. PPG Architectural Finishes, Inc.

Lawson v. PPG Architectural Finishes, Inc.

Opinion

KRUGER, J.—The question in this case concerns the proper method for presenting and evaluating a claim of whistleblower retaliation under Labor Code section 1102.5. Since 2003, the Labor Code has prescribed a framework: Once an employee-whistleblower establishes by a preponderance of the evidence that retaliation was a contributing factor in the employee's termination, demotion, or other adverse action, the employer then bears the burden of demonstrating by clear and convincing evidence that [*2]  it would have taken the same action “for legitimate, independent reasons.” (Lab. Code, § 1102.6, added by Stats. 2003, ch. 484, § 3, pp. 3518–3519.) But in the years since section 1102.6 became law, some courts have persisted in instead applying a well-worn, but meaningfully different, burden-shifting framework borrowed from the United States Supreme Court's decision in McDonnell Douglas Corp. v. Green (1973) 411 U.S. 792 [36 L. Ed. 2d 668, 93 S. Ct. 1817] (McDonnell Douglas). Noting the lack of uniformity, the United States Court of Appeals for the Ninth Circuit has asked us to decide which of these frameworks governs section 1102.5 retaliation claims. Unsurprisingly, we conclude courts should apply the framework prescribed by statute in Labor Code section 1102.6. Under the statute, employees need not satisfy the McDonnell Douglas test to make out a case of unlawful retaliation.

We take the facts from the Ninth Circuit's certification order. From 2015 until he was fired in 2017, plaintiff Wallen Lawson worked as a territory manager for defendant PPG Architectural Finishes, Inc. (PPG), a paint and coatings manufacturer. Lawson was responsible for stocking and merchandising PPG paint products in Lowe's home improvement stores in Southern California. PPG used two metrics to evaluate Lawson's performance: his ability to meet sales goals, and his scores on so-called market walks, during which PPG managers [*3]  shadowed Lawson to evaluate his rapport with Lowe's staff and customers, among other things. Lawson's direct supervisor, Clarence Moore, attended all but the first of these market walks. On that first market walk, Lawson received the highest possible rating, but the positive evaluations did not last and his market walk scores soon took a nosedive. Lawson also frequently missed his monthly sales targets. In spring 2017, PPG placed Lawson on a performance improvement plan.

According to Lawson, that same spring, Moore began ordering him to intentionally mistint slow-selling PPG paint products—that is, to tint the paint to a shade the customer had not ordered. Lowe's would then be forced to sell the paint at a deep discount, enabling PPG to avoid buying back what would otherwise be excess unsold product. Lawson did not agree with this mistinting scheme and filed two anonymous complaints with PPG's central ethics hotline. He also told Moore directly that he refused to participate. The complaints led to an investigation. PPG eventually told Moore to discontinue the practice, but Moore remained with the company, where he continued to directly supervise Lawson and oversee his market walk [*4]  evaluations.

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