Two recent California appellate decisions in Faust v. California Portland Cement (5/10/07) and Malais v. Los Angeles City Fire Dep’t (3/29/07) emphasized the importance of properly training managers in responding to claims of medical and disability leaves.

California’s Fair Employment and Housing Act (“FEHA”) obligates employers to engage in the interactive process and accommodate employees who suffer from a disability, as defined by statute. California employers employing 50 or more employees are also obligated to provide qualifying employees with 12 weeks of protected leave in a 12 month period under the California Family Rights Act (“CFRA”). Employers subject to the CFRA are required to provide notice to their employees of their rights under the statute. The interplay of the FEHA, CFRA and workers’ compensation can be confusing, thus creating issues of liability for many employers.

The California Court of Appeal’s decision in Faust v. California Portland Cement demonstrated the importance of correctly understanding and training managers and supervisors in applying these principles. In Faust, the Court of Appeal reversed the trial court’s summary judgment in favor of the employer and found the employer failed to provide proper notice to the employee under the CFRA.

Faust, a “lube specialist,” entered into a 30 day psychiatric program as a result of severe stress and filed a workers’ compensation claim. His attorney informed the company of the claim and provided documentation of psychiatric impairment. Faust also submitted a medical certification from his chiropractor indicating he was being treated for back pain and would be unable to perform his regular duties for a period of time. The company’s human resources manager questioned the adequacy of the certificate and left Faust a message and sent him a letter outlining what she believed was incomplete about the doctor’s note. Faust’s wife returned the call and requested the company limit its communications to her, the chiropractor, or the workers’ compensation attorney, because Faust’s psychiatrist had advised him not to speak with the company due to his anxiety. The company did not contact any of the individuals.

Ultimately, the company terminated Faust after seven weeks of leave and failed to designate the leave as CFRA/FMLA leave. Faust sued for disability discrimination and harassment under the FEHA, retaliation, wrongful termination, violations of the CFRA and violation of California’s Business and Professions Code. The trial court granted the company’s motion for summary judgment, which the Court of Appeal reversed.

The Court of Appeal reversed on a number of grounds. Specifically, the court found the company’s failure to post the required CFRA/FMLA notices and inform Faust of his right to CFRA leave precluded it from denying leave or taking any adverse action against the employee, including denying CFRA leave. Faust’s retaliation and FEHA claims also survived summary judgment because the company’s legitimate business reasons were undermined by the fact that the company refused to communicate with any of Faust’s representatives, and thus failed to engage in the interactive process.

Conversely, the Court of Appeal in Malais v. Los Angeles City Fire Dep’t found in favor of the employer, where it properly accommodated the employee under the FEHA. Malais was a Captain with the Los Angeles Fire Department who sued the department for disability discrimination and retaliation under the FEHA when he was given special duty assignment following the partial amputation of one of his legs. The Department refused to return him to platoon duty, as they believed there was a risk to Malais, his co-workers and the public. In fact, it was undisputed that the Department denied Malais his desired job solely because of his disability. While on special duty he received the same pay and promotional opportunities.

The Court of Appeal reviewed the California Supreme Court’s definition of an adverse employment action in Yanowitz v. L’Oreal USA, Inc., (2005) 36 Cal 4th 1049,1055, which defined an adverse action as discrimination regarding compensation, terms, conditions or privileges of employment and disparate treatment in employment. However, the Yanowitz Court added: “A change that is merely contrary to an employee’s interests or not to the employee’s liking is insufficient.” The Court of Appeal found although Malais was denied the job he wanted because of his disability, he continued to receive promotions. Moreover, there was no evidence he suffered from a hostile work environment. The appellate court said there is no precedent finding adverse employment actions “in transfers involved working assignments the employee preferred less than other assignments, but with equal pay, benefits, promotional opportunities, and no hostile environment.”