Despite test favorable to employees, California Court of Appeals rules in favor of employer in whistleblower retaliation suit

As we reported here, earlier this year the California Supreme Court upheld a relaxed standard by which employees can prove whistleblower retaliation under Labor Code Section 1102.5 in Lawson vs. PPG Architectural Finishes, Inc., 12 Cal. 5th 703 (2022). Despite the newly asserted and extremely onerous burden on employers to prevail against Section 1102.5 claims on summary judgment, the Third District Court of Appeals recently ruled in favor of Sacramento County in a lawsuit filed by the former county employee, Cynthia Vatalaro in Vatalaro v. Sacramento CountyNo. C090896, 2022 WL 1775708 (Cal. Ct. App. May 5, 2022).

Vatalaro was an administrative analyst for Sacramento County. She received a job description listing the expected duties for her promotion to an administrative services officer position from her future supervisor, Mindy Yamasaki. Vatalaro contacted a human resources analyst to express her concerns about the planned reporting structure, the tasks assigned to her differing from those she had developed with her former supervisor and that the assigned tasks seemed “inappropriate” for her. job. Soon after, Vatalaro started his new position, which was probationary for a period of six months under county civil service rules. Ultimately, the county determined that Vatalaro had failed during the trial period, fired Vatalaro from the promoted position, and returned her to her previous job classification.

Vatalaro sued Sacramento County for unlawful retaliation under Labor Code Section 1102.5[1]claiming that Yamasaki repeatedly abused her as follows:

  • Assigning Vatalaro a job “too modest” for his position;
  • Excluding him from a staff appreciation meeting with “treats” by holding it on a day that Vatalaro had taken off;
  • Giving Vatalaro certain assignments as “punishment” for complaining to Vatalaro’s former supervisor about Yamasaki’s conduct;
  • Teaming up with a colleague to “harass” Vatalaro repeatedly after further complaints about his missions.

Vatalaro attributed Yamasaki’s alleged mistreatment to Vatalaro’s complaints about the tasks assigned to him. Vatalaro also claimed that she was released from her probation in retaliation for her complaints. Yamasaki submitted a memorandum supporting the release on the grounds that Vatalaro had been subordinate, disrespectful, and dishonest in his actions, pointing out several instances where she believed Vatalaro exhibited these qualities, such as Vatalaro repeatedly calling several meetings and assignments “a waste of she”. time,” and being dishonest about why she couldn’t complete a mission.

The county filed a motion for summary judgment. The parties and the court of first instance have defined their respective positions and decisions around the Mc Donnel Douglas charge transfer test, and the trial court granted the motion in favor of the county. The trial court found that the county had met its obligation to show that Vatalaro could not allege a prima facie case of retaliation because she had not alleged or presented evidence of protected conduct. The court held that Vatalaro had neither “alleged that she had a reasonable belief that a specific federal, state or local law or regulation had been violated”, nor “presented evidence that she had engaged in protected conduct”, but had instead shown that she complained of “internal personnel matters”. The trial court added that the county presented evidence that it had a legitimate business reason to release her from her probation and that Vatalaro failed to establish a pretext. Vatalaro appealed.

The Third District Court of Appeals upheld the trial court’s final decision, but in light of Lawson, did so in accordance with the standard of proof in Article 1102.6, rather than the Mc Donnel Douglas test. Section 1102.6 states:

[O]since it was demonstrated by a preponderance of evidence that an activity prohibited by section 1102.5 was a contributing factor in the prohibited action alleged against the employee, the employer will have the burden of proof to show by clear and convincing evidence that the alleged action occurred during legitimate and independent reasons even if the employee had not engaged in activities protected by section 1102.5

Cal. Laboratory. Code § 1102.6 (emphasis added). The Court of Appeal held that the county had discharged its burden and that the plaintiff did not need to show a pretext. The appeals court also considered whether the test for a prima facie case of retaliation required that a claimant actually have a reasonable belief, distinct from the plain language of section 1102.5, which states that the employee must ” have reasonable cause to believe” there was a violation of the law. Ultimately, the appeals court did not resolve the matter, stating that the county’s independent reasons for the dismissal were sufficient to satisfy their summary judgment burden.

[1] Vatalaro also asserted a cause of action for constructive discharge in violation of public order. The cause of action was dismissed on summary judgment because, among other things, a public employee is not permitted to assert such a claim against a public entity employer. The trial court’s decision on this cause of action was not discussed in the Court of Appeal’s decision.

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