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February 8, 2013

California Supreme Court Heightens the Burden for Employees in FEHA Discrimination Cases, Confirms the Viability of Mixed-Motive Defenses, and Changes Scope of Remedies Available to Employees


On February 7, 2013, the California Supreme Court (“High Court”) issued its decision in Harris v. City of Santa Monica (Los Angeles County Super. Ct. No. BC341469).  The High Court ruled that the Court of Appeal was correct, in part, in holding that under the Fair Employment and Housing Act, (“FEHA”), when a jury finds that unlawful discrimination was a factor motivating a termination of employment, that the mixed-motive defense is available to employers.   However, the High Court found that the Court of Appeals was incorrect on the standard an employee must meet to establish discrimination in the first instance, and noted that if the employers’ mixed-motive defense was successful, the employer does not escape complete liability. 

In Harris, a bus driver alleged that she was fired by the City of Santa Monica (“the City”) because of her pregnancy in violation of the prohibition on sex discrimination in the FEHA.  The City claimed that she had been fired for poor job performance.  At trial, the City asked the court to instruct the jury that if it found a mix of discriminatory and legitimate motives, the City could avoid complete liability by proving that a legitimate motive alone would have led it to make the same decision to fire her. 

Specifically, the City asked the court to give an instruction that pertained to its mixed-motives defense.  BAJI No. 12.26 states “If you find that the employer’s action, which is the subject of plaintiff’s claim, was actually motivated by both discriminatory and non-discriminatory reasons, the employer is not liable if it can establish by a preponderance of evidence that its legitimate reason, standing alone, would have induced it to make the same decision.  An employer may not, however, prevail in a mixed-motives case by offering a legitimate and sufficient reason for its decision if that reason did not motivate it at the time of the decision.  Neither may an employer meet its burden by merely showing that at the time of the decision it was motivated only in part by a legitimate reason.  The essential premise of this defense is that a legitimate reason was present, and standing alone, would have induced the employer to make the same decision.”  The trial court refused the instruction, and the jury returned a substantial verdict for the employee. 

The Court of Appeal reversed, holding that the City’s requested instruction was legally correct, and that refusal to give it was prejudicial error.  The Court of Appeals remanded the case to the trial court with instructions to retry the case, and to give the requested jury instruction.  Further, if the trier of fact agreed that the employer had a legitimate non-discriminatory reason to terminate the employee, then despite the discriminatory reason, the employer was entitled to a finding of no liability.  The employee’s petition for review was granted by the High Court. 

In reaching its decision, the High Court noted that it first had to determine the meaning of the phrase “because of” in section 12940(a) defining discrimination.  The Court determined that there were at least three plausible meanings of the phrase “because of” in section 12940(a), each of which is supported by some authority:

1. discrimination was a “but for” cause of the employment decision;

2. discrimination was a “substantial factor” in the decision;

3. discrimination was simply a “motivating factor”

The High Court ultimately construed section 12940(a) to mean that an employee must show by a preponderance of the evidence that the discrimination was a “substantial motivating factor”, as opposed to a motivating factor in his or her termination, and that the trier of fact does not even get to the mixed-motive instruction unless an employee establishes the higher standard.  If the employee does meet the new higher standard, then the employer can avail itself of the mixed-motive defense, which if successful would allow the employer to escape awards of damages, backpay, or orders of reinstatement.  However, the High Court noted that employers still do not escape liability completely in that the employee can still be entitled to declaratory or injunctive relief, as well as an award of reasonable attorney’s fees and costs. 

Ultimately, the California Supreme Court remanded the issue back to the trial court for a determination in the first instance as to whether the employee could meet the substantial motivating factor test, and then and only then, would the trier of fact need to receive the mixed-motive jury instruction. 

Impact on Employers
The Harris decision will make it initially more difficult for employees to persuade a trier of fact that the employer terminated the employee for a prohibited discriminatory reason.  Also, pursuant to the availability of the mixed-motive defense, the fact that employees could be relegated to an award of only declaratory and injunctive relief and attorneys’ fees, but no damages, reinstatement or backpay, could reduce employees’ incentive to pursue employment discrimination claims.  Further, the language in the California Civil Jury Instructions (“CACI”) pertaining to FEHA discriminatory actions should be updated to read “substantial motivating factor”, as opposed to motivating factor in order to confirm to the High Court’s opinion. 

However, as employers are well aware, declaratory relief in the form of an order that an employer has discriminated, or injunctive relief ordering that an employer cease discriminatory practices, can have major practical implications in future discrimination cases.  Further, in many employment cases, attorneys’ fees and costs can, as it did in the Harris case, greatly exceed the damages awarded to successful employees. 

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