Wrongful Termination and Disability Discrimination

Wrongful termination from employment is tortious when the termination occurs in violation of a fundamental public policy. Gantt v. Sentry Insurance (1992) 1 Cal.4^th 1082, 1090. A policy is “fundamental” when it is “carefully tethered” to a policy “delineated in constitutional or statutory provisions” (id. at p. 1095), involves a duty affecting the public at large, rather than one owed to or imposed solely upon the parties to a dispute (id. at 1090), and is “well established” and “sufficiently clear” to the employer at the time of the discharge. Id. Wrongful termination cases typically arise when an employer retaliates against an employee for refusing to violate a statute, performing a statutory obligation, exercising a statutory right, or reporting an alleged violation of a statute of public importance. Turner v. Anheuser-Busch, Inc. 7 Cal.4^th 1238, 1256 (1994). However, as noted in Soules v. Cadam, Inc. 2 Cal.App.4th 360, 201 (1991), an action for tortious discharge is not strictly limited to these situations but will lie “wherever the basis of the discharge contravenes a fundamental public policy.”

Overtime wages are a well-established example of a fundamental public policy fostering society’s interest in a stable job market. Gantt v. Sentry Insurance, supra, 1 Cal.4^th at p. 1095. Furthermore, as California courts have consistently explained, the Legistlature’s decision to criminalize certain employer conduct reflects a determination that the conduct affects a broad public interest. Gould v. Maryland Sound Industries, Inc. 31 Cal.App.4th 1137, 1148-1149 (1995). Under Labor Code sections 1174 and 1175, it is a crime for an employer to fail to keep or refuse to furnish payroll records showing the hours worked daily by, and wages paid to, its employees. Under Labor Code section 1199, it is a crime for an employer to fail to pay overtime wages as fixed by the Industrial Welfare Commission. Furthermore, Federal and California law prohibit an employer from firing or otherwise retaliating against an employee for exercising her rights under wage and hour laws. See 29 U.S.C. § 215(a)(3); Cal. Labor Code § 98.6(a).

Whistleblower retaliation liability can arise under Tameny v. Atlantic Richfield Co. (1980) 27 Cal.3d 167 and California Labor Code § 1102.5. Tameny  and its progeny provide a cause of action for wrongful demotion in violation of public policy. See Garcia v. Rockwell Internat. Corp. (1986) 187 Cal.App.3d 1556. Labor Code § 1102.5(c) is a codification of the common law Tameny claim, and it prohibits an employer from retaliating, including demotion or transfer, against an employee for refusing to participate in any action that would lead to the violation of any state or federal statute.

Employers have an obligation to reasonably accommodate employees’ disabilities. Under the Americans with Disabilities Act  (“ADA”) and California Fair Employment and Housing Acts (“FEHA”), “reasonable accommodation” may include “reassignment to a vacant position.” 42 U.S.C. § 12111(9)(B); Cal. Gov. Code § 12926(n)(2). A qualified individual with a disability includes an individual who could perform the essential functions of a reassignment position, with or without reasonable accommodation, even if they cannot perform the essential functions of their current position. Barnett v. U.S. Air, Inc., 228 F.3d 1105, 1111 (9th Cir. 2000), vacated on other grounds and remanded, 535 U.S. 391 (2022).

An employer is obligated to reassign a disabled employee to another position if there is an existing, vacant position for which the employee is qualified, unless it would impose an undue hardship on the employer’s operations. Watkins v. Ameripride Servs., 375 F.3d 821, 828 (9th Cir. 2004); see also Spitzer v. Good Guys, Inc., 80 Cal.App.4th 1376, 1389 (2000) (employer has duty to reassign disabled employee if already funded, vacant position at same level exists). According to the Equal Employment Opportunity Commission (“EEOC”) Enforcement Guidance on Reasonable Accommodation and Under Hardship Under the ADA, reassignment is available as a reasonable accommodation even to probationary employees.

“The link between the disability and the termination is particularly strong where it is the employer’s failure to reasonably accommodate a known disability that leads to discharge for performance inadequacies resulting from that disability.” Humphrey v. Memorial Hosps. Assn. (9th Cir. 2001) 239 F.3d 1139-1140.