A decade ago, in Reno v. Baird, the California Supreme Court held that individual employees could not be held personally liable for discrimination under the California Fair Employment and Housing Act. Until this past week, however, the law regarding whether individual employees could be held liable for retaliation was unsettled. In Jones v. The Lodge at Torrey Pines Partnership, the Supreme Court of California clarified that, as in discrimination cases, only employers and not individual employees can be held liable for retaliation.
Torrey Pines, Scott Jones sued his employer, The Lodge at Torrey Pines Partnership and his supervisor for retaliation. A jury awarded Jones damages of over a million dollars against his employer and $155,000 against his supervisor. The Court of Appeals upheld the verdict and specifically held that the supervisor could be held individually liable for retaliation. The Supreme Court disagreed.
The Supreme Court reviewed the legislative history of the Fair Employment and Housing Act and its amendments and found no convincing evidence supporting the Plaintiff's contention that individual employees could be held personally liable. Moreover, the Court cited several public policy considerations supporting its decision. Specifically, the Court stated that individuals should not face potential liability for performing their job duties of hiring, firing, and disciplining. The Court believed that individual liability would have a chilling effect on effective management because supervisors would be deterred from making tough decisions due to the possibility of being sued. The Court also noted that corporate decisions are often collective and individuals should not be subjected to personal liability for a decision in which they only played a small role. Finally, the court opinioned that it would be bad policy to subject supervisors to the threat of a lawsuit every time they make a personnel decision.
This decision is significant to all supervisors and employees who make employment decisions as they no longer face the threat of a potential liability for their personnel decisions.