Taylor v. City of Los Angeles Dept. of Water & Power

Facts

The statutory framework. The Fair Employment and Housing Act (FEHA) prohibits an employer, “because of the race … of any person, to refuse to hire or employ the person or to refuse to select the person for a training program leading to employment, or to bar or to discharge the person from employment or from a training program leading to employment, or to discriminate against the person in compensation or in terms, conditions, or privileges of employment.” (Gov. Code, § 12940, subd. (a); Taylor v. City of Los Angeles Dept. of Water & Power (2006) 144 Cal.App.4th 1216, 1228.) The anti-retaliation provision in turn makes it an unlawful employment practice for “any employer … or person to discharge, expel, or otherwise discriminate against any person because the person has opposed any practices forbidden under this part or because the person has filed a complaint, testified, or assisted in any proceeding under this part.” (Gov. Code, § 12940, subd. (h); Taylor, supra, 144 Cal.App.4th at p. 1228.) And the failure-to-prevent provision—the statutory home of CACI No. 2527—provides that it is unlawful for an employer “to fail to take all reasonable steps necessary to prevent discrimination and harassment from occurring.” (Gov. Code, § 12940, subd. (k); Taylor, supra, at p. 1239.)

An engineer on a promotional track. Plaintiff Eric Taylor is an electrical engineer for the City of Los Angeles Department of Water and Power (DWP). Hired in 1988, he was promoted through 2000 and, in 2002, his supervisor, defendant Bruce Hamer, named him supervising lead engineer over three DWP and three contract employees in the fiber optic enterprise group. (Taylor, supra, 144 Cal.App.4th at pp. 1222–1223.) Hamer recommended he attend in-house classes leading to a certificate in supervision—coursework Taylor pursued “with the goal of advancing to full engineer, a promotion with a potential salary increase of $25,000 and other benefits.” (Id. at p. 1223.)

Taylor opposes race discrimination against a subordinate. On May 16, 2003, Hamer terminated Donald Coleman, a 13-year DWP employee Taylor supervised, without first notifying Taylor. (Taylor, supra, 144 Cal.App.4th at pp. 1222–1223.) Coleman filed two EEO complaints claiming wrongful termination because of his race (Black), identified Taylor as a supporting and material witness, and subpoenaed him. (Id. at p. 1223.) Over the next six months, Taylor “opposed Coleman’s termination by providing information to the EEO office, participating in several investigative interviews, and testifying in Coleman’s support at the hearing.” (Ibid.) DWP ultimately reinstated Coleman with full backpay ten months later. (Ibid.)

The course of retaliation. Taylor alleged that the retaliation tracked his protected acts almost day-for-day. About a week after Coleman named Taylor as a witness, Hamer “showed Taylor a new organizational chart that designated another employee to take his place as supervising lead engineer,” then threatened to eliminate Taylor’s 4/10 work schedule and, on July 1, “stripped Taylor of his supervisory position and responsibilities.” (Taylor, supra, 144 Cal.App.4th at p. 1223.) After Taylor testified, Hamer told him he would not receive the emergency-appointment promotion to electrical engineer—“I hope you weren’t counting on this!”—and gave the position “to another employee with fewer qualifications and no supervisory experience whom Taylor was instructed to train.” (Id. at p. 1224.)

Escalation after Taylor complained. When Taylor complained of retaliation, Hamer “exchanged Taylor’s more important assignments with less important ones,” transferred his technical contracts away, barred him from the supervisory training series, labeled him a “troublemaker” to managers of groups to which Taylor sought transfer, disclosed confidential grievance information to coworkers, and excluded him from meetings and vendor sessions “on 21 known occasions,” leaving Taylor “uninformed,” “uninvolved” and “undermined.” (Taylor, supra, 144 Cal.App.4th at pp. 1224–1225.) Having passed the written civil-service examination, Taylor sat for the oral portion—whose opening questions concerned the very supervisory experience and training of which he had been stripped—and “ultimately placed in ‘Rank 9’ on the civil service list for full engineer behind 29 other applicants,” including the engineer Hamer had favored. (Id. at p. 1226.) Taylor exhausted his administrative remedies, filing with the DFEH on September 30, 2004, and receiving a right-to-sue letter on November 4, 2004. (Ibid.)

Procedural history

Taylor filed suit on April 29, 2005, pleading retaliation under section 12940, subdivision (h) and failure to take necessary remedial action under section 12940, subdivisions (j) and (k). (Taylor, supra, 144 Cal.App.4th at p. 1227.) The trial court (Hon. Ronald M. Sohigian) sustained the defendants’ general demurrer to the first amended complaint without leave to amend and dismissed the action on September 14, 2005. (Ibid.) Relying on Yanowitz v. L’Oreal USA, Inc. (2005) 36 Cal.4th 1028, the court held the alleged conduct was not sufficiently “material,” reasoning that the “‘denial of emergency appointment,’ ‘threats of discipline,’ ‘negative comments’ and ‘alteration of job responsibilities’ did not amount to retaliation.” (Ibid.) The court further held that, as a public employee, Hamer was immune for discretionary personnel actions, and that there was no FEHA cause of action for failure to prevent retaliation. (Ibid.) While the appeal was pending, the United States Supreme Court decided Burlington N. & S. F. R. Co. v. White (2006) 548 U.S. 53, and the Court of Appeal requested supplemental briefing on it. (Ibid.) The Court of Appeal, Second Appellate District, Division Seven, reversed in a unanimous opinion by Justice Zelon, with Perluss, P. J., and Johnson, J., concurring. (Id. at pp. 1222, 1241.) The Supreme Court denied review on February 14, 2007. (Id. at p. 1241.)

Issue

Three questions framed the appeal from the demurrer. First, whether Taylor pleaded an actionable “adverse employment action” for FEHA retaliation where he alleged not a single discrete act but a continuous course of conduct—and whether that question is governed by the materiality test of Yanowitz, the deterrence test of Burlington, or both. (Taylor, supra, 144 Cal.App.4th at pp. 1230–1231.) Second, whether a supervisor may be held personally liable for retaliation under section 12940, subdivision (h), and whether, as a public employee, he is immune under the discretionary-act immunity of Government Code section 820.2. (Id. at pp. 1236–1238.) Third—the question that gives this case its lasting weight—whether section 12940, subdivision (k), “permits a claim for failure to prevent or investigate discrimination, when the only cause of action at issue is retaliation, rather than discrimination or harassment as referenced under the subdivision.” (Id. at p. 1239.)

Holding

Reasoning

Demurrer posture: every well-pleaded fact assumed true. Reviewing de novo, the court “assume[d] the truth of the facts alleged in the complaint, facts that reasonably can be inferred from those expressly pleaded, and facts of which judicial notice can be taken,” and “liberally construe[d] the complaint to achieve substantial justice between the parties.” (Taylor, supra, 144 Cal.App.4th at pp. 1227–1228.) That standard shaped the entire analysis: the court repeatedly tested whether the alleged facts, taken as true, could support a retaliation theory, not whether Taylor would ultimately prove them.

The retaliation framework and the protected-activity element. The court set out the familiar three-part prima facie case—protected activity, adverse employment action, and a causal link—drawn from Flait v. North American Watch Corp. (1992) 3 Cal.App.4th 467, 476. (Taylor, supra, 144 Cal.App.4th at p. 1229.) On protected activity, it rejected the defense premise that Taylor merely was “named a witness,” observing that he also “affirmatively ‘opposed’ race discrimination” by testifying and providing information to the EEO office, and later “‘filed a complaint’ for retaliation,” so that he “engaged in multiple protected activities.” (Id. at p. 1229.)

Adverse action under the Yanowitz materiality test. The court explained that in Yanowitz our Supreme Court “elected to follow the materiality test,” under which “a retaliation claim lies only for an employment action that materially affects the terms and conditions of employment,” assessed by the “‘totality of the circumstances.’” (Taylor, supra, 144 Cal.App.4th at pp. 1230–1231.) Critically, Yanowitz teaches that “there is no requirement that an employer’s retaliatory acts constitute one swift blow, rather than a series of subtle, yet damaging, injuries.” (Id. at p. 1231.) Applying that frame, the court catalogued the alleged conduct—stripped supervisory position, threatened work schedule, barred certification, exclusion from meetings, removed contracts, the denied emergency appointment, the “troublemaker” label, and disclosure of confidential information—and concluded this “continuous course of conduct culminated in Taylor’s low rank on the civil service list.” (Id. at p. 1232.) These were not “mere offensive utterance[s] or … a pattern of social slights,” but, under “the realities of the workplace,” adverse actions “material” to the terms and conditions of employment. (Ibid.)

Distinguishing McRae—a true “continuous course” versus disconnected events. The court rejected the defense analogy to McRae v. Department of Corrections and Rehabilitation (2006) 142 Cal.App.4th 377, where a surgeon’s purported retaliation was “in fact a series of events, each bearing little relationship to the others,” some of which “clearly were not the result of unlawful retaliation.” (Taylor, supra, 144 Cal.App.4th at p. 1232.) By contrast, Taylor’s allegations described “a continuous course of conduct” in which the wrongful acts were taken by his immediate supervisor “in response to a single protected act,” the very pattern that distinguishes an actionable claim. (Id. at pp. 1232–1233.)

Adverse action also satisfied the broader Burlington deterrence test. The court surveyed Burlington, where the United States Supreme Court held that Title VII’s anti-retaliation provision “does not confine the actions and harms it forbids to those that are related to employment or occur at the workplace,” but covers “those (and only those) employer actions that would have been materially adverse to a reasonable employee.” (Taylor, supra, 144 Cal.App.4th at p. 1233.) “Seeing no apparent differences in legislative intent for the anti-retaliation provisions of the FEHA and Title VII,” the court asked whether a jury could find the defendants’ actions “so harmful as to dissuade a reasonable worker from making or supporting a charge of discrimination,” and concluded that “a reasonable city engineer with nearly two decades of tenure and similar promotional objectives would be deterred.” (Id. at p. 1235.) The court noted DWP conceded at oral argument that, if Burlington applied, “the complaint would survive a demurrer.” (Id. at p. 1235, fn. 5.)

Causation supplied by temporal proximity. On the causal link, the court invoked the settled rule that “[c]lose proximity in time of an adverse action to an employee’s resistance or opposition to unlawful conduct is often strong evidence of a retaliatory motive.” (Taylor, supra, 144 Cal.App.4th at p. 1235.) It found “compelling the timing—each incident of adverse action exacted by Hamer occurred within days of each act of opposition by Taylor,” and inferred from the “course of conduct over time” that Hamer’s “originally supportive attitude toward Taylor soured when he engaged in protected activity.” (Id. at p. 1236.)

Supervisors are personally liable for retaliation. The court rejected reliance on Reno v. Baird (1998) 18 Cal.4th 640, which barred individual liability under subdivision (a) because that provision reaches only “an employer.” (Taylor, supra, 144 Cal.App.4th at pp. 1236–1237.) Subdivision (h), by contrast, reaches “any employer … or person,” and FEHA defines “person” to include “one or more individuals” and separately defines “supervisor.” (Id. at p. 1237.) Following Walrath v. Sprinkel (2002) 99 Cal.App.4th 1237 and a line of federal authority, the court held the distinct statutory language “indicat[es] a legislative intent to allow individual liability for retaliation by supervisors,” and concluded “a supervisor may be held personally liable for retaliation under the FEHA.” (Ibid.)

No discretionary-act immunity for retaliatory personnel acts. Turning to Government Code section 820.2, the court explained that under the Tort Claims Act “the rule is liability, immunity is the exception,” and that immunity reaches “‘basic policy decisions’” made at the “‘planning’” stage, not “‘ministerial’” acts that merely implement policy. (Taylor, supra, 144 Cal.App.4th at pp. 1238–1239.) Although Caldwell v. Montoya (1995) 10 Cal.4th 972 immunized a school board’s contract-renewal decision, the “decisions regarding job assignments, training and promotion” alleged here were “routine duties incident to the normal operations” of Hamer’s position, not protected policymaking, so “the alleged retaliatory actions by Hamer, as pleaded, are not the type accorded discretionary immunity under section 820.2.” (Id. at p. 1239.)

The core move: retaliation is discrimination under subdivision (k). On the failure-to-prevent claim, the court confronted a question on which “[t]he FEHA and California case law are silent”: whether subdivision (k) reaches a failure to prevent retaliation “when the only cause of action at issue is retaliation, rather than discrimination or harassment as referenced under the subdivision.” (Taylor, supra, 144 Cal.App.4th at p. 1239.) The court answered yes. It found persuasive the federal district court’s reasoning in Giovannetti v. Trs. of the Cal. State Univ. that, given FEHA’s “‘liberal construction principles’” and “‘the fact that retaliation claims themselves are defined as “discriminat[ion]” under section 12940(h),’” a plaintiff may proceed on a subdivision (k) claim “‘based on a failure to prevent retaliation, which is a form of discrimination.’” (Id. at pp. 1239–1240.) Yanowitz reinforced the point: viewing section 12940 “as a whole,” the Legislature “intended to extend a comparable degree of protection both to employees who are subject to the types of basic forms of discrimination … and to employees who are discriminated against in retaliation for opposing such discrimination.” (Id. at p. 1240.) The court drew further support from the United States Supreme Court’s Title IX analysis in Jackson v. Birmingham Bd. of Educ. (2005) 544 U.S. 167, where “‘retaliation is discrimination “on the basis of sex” because it is an intentional response to … an allegation of sex discrimination.’” (Taylor, supra, at p. 1240.) Synthesizing these authorities and “the fundamental public policy of eliminating discrimination in the workplace under the FEHA,” the court held that “retaliation is a form of discrimination actionable under section 12940, subdivision (k).” (Ibid.) The subdivision (k) duty to “take all reasonable steps necessary to prevent discrimination”—the theory behind CACI No. 2527—thus encompasses a duty to prevent retaliation.

Significance

Taylor is the Court of Appeal’s foundational holding that a stand-alone retaliation claim can support a derivative cause of action for failure to prevent under section 12940, subdivision (k). The statutory text speaks only of “discrimination and harassment,” and before Taylor a defendant could plausibly argue that an employee who pleaded retaliation alone fell outside the subdivision. By grounding the answer in subdivision (h)’s own definition of retaliation as a species of “discriminat[ion]” and in Yanowitz’s whole-statute reading, Taylor closed that gap and gave CACI No. 2527 plaintiffs a clean, published authority connecting the failure-to-prevent duty to retaliation. (Taylor, supra, 144 Cal.App.4th at p. 1240.)

The decision is equally important for two structural propositions. First, it is a leading California statement that the materiality and deterrence tests both tolerate a “continuous course of conduct” theory: an employee need not point to a single termination or demotion where an accumulation of lesser acts culminates in a tangible career setback such as a depressed promotional rank. (Id. at pp. 1231–1232, 1235.) Second, by holding that supervisors face personal liability for retaliation under subdivision (h), and that ordinary retaliatory personnel acts are not immunized “discretionary” decisions under section 820.2, Taylor keeps individual public-entity supervisors within FEHA’s reach. (Id. at pp. 1237–1239.) The holding’s limits bear emphasis: it arises on demurrer, establishing only the sufficiency of the pleading and leaving proof of materiality, causation, and the absence of a legitimate explanation for trial.

Key quotes

“[W]e conclude that … retaliation is a form of discrimination actionable under section 12940, subdivision (k).” (Taylor, supra, 144 Cal.App.4th at p. 1240.)

“This continuous course of conduct culminated in Taylor’s low rank on the civil service list for full engineer, a position he was apparently groomed to assume prior to assisting Coleman with his race discrimination complaints.” (Id. at p. 1232.)

“We agree with these cases and conclude that a supervisor may be held personally liable for retaliation under the FEHA.” (Id. at p. 1237.)

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Practice pointer

Open questions

Leave to amend. Because the substantive issues were dispositive, the court “need not reach the question of whether the trial court abused its discretion by dismissing the action without leave to amend.” (Taylor, supra, 144 Cal.App.4th at p. 1227, fn. 2.)

Subdivision (j) failure-to-prevent theory. The trial court found no cause of action under either subdivision (j) or (k), but “[o]n appeal, Taylor contests only the court’s ruling on subdivision (k)” (Taylor, supra, 144 Cal.App.4th at p. 1239), so whether subdivision (j) likewise supports a failure-to-prevent-retaliation theory remained unaddressed.

Choosing between the materiality and deterrence tests. The court found the complaint sufficient “under both standards” and observed that the “materiality and deterrence tests differ in some respects” (Taylor, supra, 144 Cal.App.4th at p. 1231), but it had no occasion to decide a case in which the two tests would yield different results—leaving the precise scope of any divergence for a future record.