Significant Case Summaries

Below are summaries of some recent California and federal court decisions that you should be aware of.  For more information, or to discuss any of the decisions in detail, please call any one of our employment lawyers at 510.836.6336 .

 

California and U.S. Supreme Court Cases

 

Pearson Dental Supplies v. Superior Court (2010) 48 Cal.4th 665

In a case with significant implications in the arbitration of employment matters involving statutory rights in California, a sharply divided California Supreme Court recently expanded the permissible scope of judicial review of an arbitrator’s decision pursuant to the California Arbitration Act (CAA).  The Court recognized its nearly unbroken line of authority strictly prohibiting judicial review of arbitrator decisions based on errors of law.  However, the Court majority, in a 4-3 decision, concluded that the scope of judicial review “may be somewhat greater in the case of a mandatory employment arbitration agreement that encompasses an employee’s unwaivable statutory rights.”  This case involved an age discrimination claim in violation of the Fair Employment and Housing Act.  Extending its prior decision in Armendariz, the Court concluded that arbitrators’ written awards in FEHA cases may be reviewed by trial courts for errors of law where the effect of the arbitrator’s award is to deny the employee a hearing on the merits of his or her FEHA claims.

 

Reid v. Google, Inc. (2010) 50 Cal.4th 512

In a case with significant implications in employment discrimination cases under California law, including the Fair Employment and Housing Act (FEHA), the California Supreme Court rejected the outright exclusion of evidence under the so-called “stray remarks doctrine.”  Under that doctrine, certain federal courts hold that statements evidencing prejudice or “illegitimate” motives for an employment decision, including age-based, sex-based, or race-based statements, are inadmissible if such comments were made by “non-decision makers” or even by supervisors if the comments were made “outside the decisional process” that the employee has brought suit on.  The Court rejected such categorical exclusion of potentially relevant evidence under California law, holding that such remarks were admissible, and should be considered with all other evidence in the record in the totality of circumstances to determine whether prohibited discrimination has occurred.

 

City of San Jose v. Operating Engineers Local Union No. 3 (2010) 49 Cal.4th 597

Can a public entity employer go directly to court to seek an injunction from a superior court when union employees, who the entity believes perform essential functions, threaten a work stoppage without first exhausting its administrative remedies before the Public Employment Relations Board (PERB)? The California Supreme Court has ruled that it cannot, and must first seek relief from PERB.  In the case, the city and the employees’ union reached an impasse in labor negotiations; the union then notified the city that it would institute a work stoppage, with 72-hour notice, taking the position that the employees affected did not perform essential functions.  The city, believing that some of the employees did perform essential functions, filed suit in superior court seeking an injunction preventing those employees from the work stoppage. Under the Meyers-Milias-Brown Act (MMBA), public employers and their employees must exhaust their administrative remedies under PERB before seeking relief in superior court.  Finding that PERB has the authority itself to seek injunctive relief in a superior court to prevent essential employees from a work stoppage if it appears that a party is acting in violation of the MMBA, the Supreme Court held that the public entity must exhaust its remedies with PERB, which has the authority to adjudicate the issue of whether an employee performs essential functions.