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In Raines v. U.S. Healthworks Medical Group, the California Supreme Court expanded the definition of an “employer” under the state’s discrimination statute to include certain third-party business entities that perform employment-related functions on behalf of employers. These agents may now be deemed “employers” such that they can be directly liable for employment discrimination under the Fair Employment and Housing Act for certain activities that they carry out on behalf of employers.

Overview of Raines

The Raines‘ plaintiffs were job applicants who received offers of employment that were conditioned on the successful completion of pre-employment medical screenings conducted by a third-party company that used automated decision-making. Plaintiffs alleged that the screening form contained intrusive questions regarding their medical history that violated FEHA. They brought claims against their employers, as well as the third-party provider that conducted the medical screening. The question for the Court was whether business entities acting as agents of an employer, can be considered “employers” under FEHA and held directly liable for FEHA violations caused by their actions.

The Court examined the plain language in FEHA’s definition of “employer” and concluded that the definition did indeed encompass third-party corporate agents like the medical provider in his case. FEHA defines an employer as “any person regularly employing five or more persons, or any person acting as an agent of an employer, directly or indirectly.” Here, the Court reasoned, recognizing the medical provider as an agent of the employer extended liability to the company most directly responsible for the FEHA violation.Continue Reading Automated Decision-Making and AI: California Expands FEHA Liability to Include Third-Party Business Agents of Employers

In July, we reported that a three-judge panel for the Ninth Circuit withdrew its holding in Vazquez v. Jan-Pro Franchising Int’l that Dynamex Operations West, Inc. v. Superior Court—the landmark California Supreme Court decision that makes it harder for companies to rely on independent contractors—applies retroactively. Rather than answering the question of Dynamex‘s retroactivity, the Court stated its intent to file an order certifying that question.
Continue Reading The Ninth Circuit Asks The California Supreme Court If Dynamex Applies Retroactively

Last month the California Supreme Court ruled in favor of a class of 1,400 student bus drivers who sued their employer for failing to comply with state background check laws. The Court’s decision is notable because it is part of a broader trend of states and cities making it more difficult for employers to use background checks. Under Connor v. First Student, Inc., employers in California must comply with overlapping statutes regulating investigative consumer reporting agencies.Continue Reading California Supreme Court Pro-Employee Ruling Affirms Employer Duty To Comply With Overlapping Background Check Laws

This month the California Supreme Court reaffirmed that workers’ compensation laws are the exclusive remedy for an employee’s injuries. In King v. CompPartners, the Court ruled that an employee’s tort claims against a utilization review company and a doctor performing a mandatory utilization review were preempted. In so doing, the Court reminded employees that the Court construes the Workers Compensation Act (WCA) liberally and broadly, in favor of awarding workers’ compensation, not in permitting civil litigation.

Continue Reading California Supreme Court Affirms Broad And Liberal Construction Of Workers’ Compensation Exclusivity Provision

Last week, in Troester v. Starbucks Corporation (Case No. S234969), the California Supreme Court weighed in for the first time on the viability of a de minimis defense to California wage and hour claims.

Many commentators have since rushed to declare that “de minimis” is dead. Not so.Continue Reading California Supreme Court Leaves Open The Possibility Of A De Minimis Defense For Wage And Hour Claims – But Not Under The Facts Of This Case