Why it matters: In the Davis v. Kiewit Pacific Co. case, the appellate panel sent a very clear message to employers: Evidentiary requirements cannot be met simply by a restatement of the applicable legal standard in an employee's declaration. Instead, to back up a motion for summary judgment on the issue of managerial discretion, employers must provide a sufficient description of job duties, responsibilities, authority, and discretion to support an argument that an employee is not a managing agent of a corporation. Otherwise, punitive damages may remain on the table in a plaintiff's FEHA suit.
Detailed Discussion
Punitive damages may be appropriate under California's Fair Employment and Housing Act where a female worker's repeated complaints about unsanitary conditions went unaddressed by her employer, the California Court of Appeal has ruled.
Lisa Davis was a box grader operator employed by Kiewit Pacific Co. on a $170 million project to excavate a 12-mile segment of canal and line it with concrete. As one of just two women on the day shift excavation crew, Davis had difficulty accessing portable toilets, which were often in an unsanitary condition. She complained to her foreman, the day shift superintendent, the night shift superintendent, and the safety officer, to no avail.
After being told to "go find a bush," Davis complained to the project manager, the highest-ranking employee on the site. Not long after, she found feces smeared all over the toilet seat and a pornographic magazine in the women's portable toilet, which she felt was retaliation for her complaints. She spoke with the equal employment opportunity officer. Days later, she was laid off along with the rest of the excavation crew. But within three weeks, many members were re hired and Davis was not.
A jury found Kiewit liable for gender discrimination, hostile work environment harassment, retaliation, and failure to prevent harassment, gender discrimination, or retaliation, awarding her $270,000.
Prior to trial, the judge granted Kiewit's motion for summary judgment on the issue of punitive damages. Davis appealed.
She argued that a triable issue of material fact remained as to whether her supervisor and the company's equal employment officer exercised "substantial discretionary authority over significant aspects" of the company's business.
The court agreed.
Davis provided evidence that the project manager she complained to was in charge of the $170 million project, with all other Kiewit managers reporting to him, and that he had the duty to interface with stakeholders, perform contract administration, and handle operations and personnel oversight. As for the EEO officer, he was responsible for the entire district, conducting training and overseeing investigations, Davis said.
In response, Kiewit provided declarations from both men, which stated: "I am not an officer or director of Kiewit. As a Kiewit employee, I have never drafted corporate policy or had substantial discretionary authority over decisions that ultimately determine Kiewit's corporate policy."
This language came straight from California case law establishing the standard on managerial discretion, a 1999 decision in White v. Ultramar, Inc., 21 Cal. 4th 563. But the panel said a mere restatement of the applicable legal standard did not suffice.
"Kiewit cannot satisfy its initial burden of production of evidence by making a conclusory statement of law, whether directly or through a declaration of one of its employees," the court wrote. "Kiewit had the initial burden to produce sufficient evidence to make a prima facie showing that there was no triable issue regarding whether [the project manager] was a managing agent of Kiewit.
"We conclude Kiewit, by simply restating the applicable legal standard under White for the determination of whether [the project manager] was its managing agent, did not satisfy its initial burden of production."
Further, the company failed to provide a sufficient description of the relevant job duties and responsibilities, the nature and extent of authority and discretion, and how the project manager exercised his authority and discretion.
"Absent evidence showing that management of a $170 million project with supervision of 100 employees is an insignificant part of Kiewit's business, a trier of fact could reasonably infer . . . that [the project manager] 'exercised substantial discretionary authority over significant aspects of [Kiewit's] business' and therefore was a managing agent of Kiewit," the court said.
The court reached a similar conclusion with regard to the EEO officer, reversing summary judgment for the employer on the issue of punitive damages.
To read the decision in Davis v. Kiewit Pacific Co., click here.
