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Legislative Update

Sept 2005

Amy L. Doherty, Esq.
FISHER & PHILLIPS LLP
4225 Executive Square, Suite 950
La Jolla, California 92037
phone: (858) 597-9600
fax: (858) 597-9601
www.laborlawyers.com

California Supreme Court Sets New Standards For Retaliation

Claims After Boss Demands A More Attractive Sales Clerk
On August 11, 2005, a divided California Supreme Court issued its decision in Yanowitz v. L'Oreal USA, Inc. (S115154), finding that a female manager could sue for retaliation based on alleged sexual discrimination against an unattractive sales clerk she refused to fire. Yanowitz was a regional sales manager for a cosmetics company. While walking through a department store with her male boss, he demanded that she fire a female sales associate whom he found unattractive and demanded “get me somebody hot.” He later pointed out a young attractive blonde woman and told her "get me one that looks like that!" Yanowitz refused to fire the unattractive woman, and alleges that her boss then launched a campaign of retaliation against her by soliciting negative information about her from her subordinates, giving her unwarranted negative evaluations and unjustified criticism, etc. Eventually Yanowitz went out on stress leave and never returned to work. Yanowitz sued her employer for retaliation against her for refusing to fire somebody whom she believed was being discriminated against and the trial court awarded summary judgment to L'Oreal. The court of appeal, however, reversed. The central issues the California Supreme Court considered where whether Yanowitz’s actions were covered by the state’s civil rights law and whether L’Oreal’s response, as alleged, would amount to retaliation. The Supreme Court answered yes to both questions and affirmed the appellate court’s conclusion that the trial court erred in granting summary judgment for L’Oreal.

Appearance Standards
The first issue the California Supreme Court addressed was whether Yanowitz reasonably believed her boss' order to fire an unattractive female salesperson was unlawful sex discrimination. It found she did, because she claimed she had supervised male and female sales associates over the years and had never been ordered to fire a male salesperson for being unattractive. The court held a trier of fact could find disparate treatment in this purportedly unequal standard of attractiveness (the court failed to address the possibility that maybe Yanowitz never supervised any unattractive male salespersons). The court declined to decide the issue of whether a gender-neutral requirement that a cosmetic sales associate be physically or sexually attractive would itself violate the Fair Employment and Housing Act or could reasonably be viewed by an employee as unlawfully discriminatory. The court did add in a footnote, however, that had L'Oreal presented evidence that physical attractiveness is a bona fide occupational qualification (“BFOQ”) for cosmetic salespersons, or that managers were required to make employment decisions on the basis of physical attractiveness, the reasonableness of Yanowitz's belief that her boss' order was discriminatory "might be questionable."

Retaliation
      The court then addressed what constitutes "adverse action" sufficient to support a retaliation claim. The court adopted the standard followed by most federal courts that an adverse employment action must "materially affect the terms, conditions, or privileges of employment," rather than the broader standard applied by the Ninth Circuit and previously applied by some California appellate courts which requires simply that the employee has been "subjected to an adverse action or treatment that would reasonably deter an employee from engaging in the protected activity." Thus far, this is a good result for employers -- but then it turns bad.
     In determining whether retaliation has occurred, held the Yanowitz court, a court must look at "all the circumstances" and consider "the entire spectrum of employment actions that are reasonably likely to adversely and materially affect an employee's job performance or opportunity for advancement in his career." While the court maintained that "a mere offensive utterance or even a pattern of social slights by either the employer or co-employees" will not suffice, just about everything else that happens in the workplace is fair game if it affects either an employee's (1) job performance or (2) opportunity to advance in his or her career. This would include, of course, negative evaluations, reprimands, and supervisory criticism.
     The Yanowitz court then applied the "continuing violations" theory to retaliation claims, declining to follow the U.S. Supreme Court's decision in National Railroad Passenger Corp. v. Morgan. Thus, alleged acts of retaliation occurring outside the statute of limitations period may be considered by a court in California in determining whether unlawful retaliation occurred, wherever a "retaliatory course of conduct" rather than a discrete act of retaliation is alleged.

What Does This Mean?
      Unfortunately, this decision is not good news for California employers.
      First, we are likely to see an increase in claims of appearance-based discrimination. The Yanowitz court holds that unequal standards of attractiveness are illegal, but what this really means is unclear. How is "attractiveness" to be judged? And how is "inequality" to be determined? Just as is the case with employees in other protected categories, unattractive employees to whom bad things happen at work are likely to assume that it's on account of their looks. Moreover, the Yanowitz court leaves open the possibility that even gender-neutral requirements that employees be attractive could be illegal.
      Second, this case makes it difficult for employers to obtain summary judgment in a retaliation case in California where multiple retaliatory acts are alleged, as the "totality of the circumstances" will have to be considered -- including allegedly retaliatory acts falling far outside the limitations period. As a practical matter, plaintiffs are now likely to base retaliation claims on a stew containing every negative supervisory comment, reprimand, disciplinary action and less than A+ evaluation they received over the course of several years. As the Yanowitz court noted, it was not holding that every adverse evaluation and criticism the plaintiff received was in fact retaliatory; it merely left it up to the trier of fact to decide whether each was in fact justified! In addition to putting summary judgment out of reach, this approach will make most trials of retaliation cases long and convoluted affairs, where mini-trials will have to be conducted regarding the justification for each supervisory act that is alleged to be part of the "pattern" of retaliation.

This column is intended to provide general information and does not constitute legal advice. Fisher & Phillips LLP is a national law firm representing employers exclusively in labor and employment matters. Amy Doherty is an associate in the San Diego office of Fisher & Phillips LLP and can be reached at (858) 597-9600.

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