Wednesday, March 22, 2023

Employee Not Entitled to Lost Wages When Race Bias Wasn’t Reason for Firing

Employee Not Entitled to Lost Wages When Race Bias Wasn’t Reason for Firing

Ajury found that a Black phlebotomist who was formerly employed at UCLA Medical Center had experienced racial harassment on the job—but it also concluded that she was fired for legitimate reasons. The jury’s award of damages for lost wages was therefore improper and could not be upheld, a California appeals court ruled.

California’s Fair Employment and Housing Act (FEHA) defines discrimination, retaliation, and harassment as separate wrongs and provides distinct remedies for each type of unlawful conduct. An award of lost wages for racial harassment can only be justified when the harassment resulted in the employee losing her job, which was not the case here, the court said. Thus, a jury award of more than $1.5 million was reduced by $276,000.

The plaintiff sued the university, alleging race discrimination, racial harassment, and retaliation in violation of FEHA. She claimed that she was wrongfully fired based on her race and in retaliation for complaining about racial discrimination and harassment.

The three claims went to trial, with the plaintiff seeking two kinds of damages:

Economic damages—described as lost wages during the period after her firing and the pay differential between her earnings at UCLA and the job she later assumed.
Noneconomic damages—based on the emotional distress she suffered from the harassment and loss of her job.
The plaintiff did not present any evidence that harassment from her colleagues caused her to lose earnings or that she missed work because of the harassment.

The university argued that the plaintiff lost wages because she was lawfully fired. Further, there was no evidence that the harassment in any way caused her lost wages, the university said.

The jury awarded both economic and non-economic damages, and the university appealed the award of the economic damages for lost wages.

Separate Violations

The appeals court first noted that FEHA defines discrimination, retaliation, and harassment as separate and distinct wrongs. Discrimination involves an official action taken by an employer, such as hiring, firing, or failing to promote. Retaliation involves an employer penalizing an employee for reporting or opposing FEHA violations.

Harassment, however, often does not involve any official exercise of delegated power on behalf of the employer. Instead, harassment focuses on situations in which the social environment of the workplace becomes intolerable.

Each distinct wrong can lead to distinct remedies, the court explained. Additionally, if a plaintiff proves one wrong, but not another, the plaintiff is limited to the remedies arising from the specific violation proven.

The trial involved three distinct wrongs, the appeals court said: wrongful termination based on racial discrimination, wrongful termination in retaliation for complaints, and hostile work environment racial harassment. The plaintiff failed to prove that she was fired based on race discrimination or retaliation, the court said.

The plaintiff was seeking economic damages for past and future loss of earnings. Such lost earnings, the appeals court said, were tied only to the plaintiff’s two theories of wrongful firing.

Because the plaintiff did not prevail on her claims of wrongful termination, she was not entitled to damages for lost wages, the court said.

The court explicitly rejected the plaintiff’s claim that all damages, including lost wages, are recoverable in a FEHA harassment case. Lost wages may be recovered only where the harassment caused the employee to stop working for the employer, the court said.

For example, in one case an employee took a medical leave of absence after years of severe sexual orientation harassment. He never returned to work. The court, in that case, concluded that the employee would have continued working for the employer if not for the harassment, and therefore damages for lost wages were appropriate.

Here, the court said, the jury specifically found that the plaintiff’s firing was not unlawful and was not related to the harassment.

The lower court’s judgment was modified to reduce the employee’s damages from nearly $1.6 million to $1.3 million.