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Employers and their managers around the country have a large stake in the outcome of two California employment cases now before the state Supreme Court. The first case will determine whether individual supervisors can be held personally liable for retaliation against a subordinate’s complaint of harassment or discrimination. The second would define just what is meant by retaliation. So far, the state’s most powerful employment groups have weighed in to oppose personal liability for managers, contending that a split in case law affecting California employers will have a chilling effect on management decisions. They want the state’s high court to clarify the reach of the Fair Employment and Housing Act (FEHA), which is the basis of the rulings. “This is a huge issue for both sides,” said Scott Toothacre of San Diego’s Toothacre & Toothacre, who represents a former food-service manager at the lodge on the Torrey Pines golf course in San Diego. A jury awarded Scott Jones $1.4 million based on sexual orientation discrimination and retaliation, and it found his supervisor, Jean Weiss, personally liable for $155,000 for retaliation after Jones complained. The trial judge upset the verdict as excessive and found that Weiss could not be held liable. The Court of Appeal reinstated the award. Jones v. Lodge at Torrey Pines Partnership, 147 Cal. App. 4th 475 (Calif. 4th Ct. App. 2007). Torrey Pines attorney Theresa Osterman Stevenson of San Diego’s Wilson Petty Kosmo & Turner did not return a message left seeking comment. All eyes watching So far, the FEHA provides no immunity for managers in harassment cases but does provide immunity from personal liability in discrimination claims. Plenty of employers around the country with managers in California will be watching to see whether the high court extends personal liability for retaliation claims. Among the amici, the California Chamber of Commerce, Employment Law Council, the Employers Group, Society for Human Resource Management and the League of California Cities have weighed in on the side of management and the lodge. The appeal is set for oral argument on Dec. 4 in Los Angeles. Tied to the Torrey Pines case is a jury award for $19 million against McKesson Corp. for wrongful termination, disability discrimination and harassment of Charlene Roby in 2004. Punitive damages accounted for $15 million of the award and $3,000 of personal liability for the manager. Roby v. McKesson HBOC, 53 Cal. Rptr. 3d 558 (Calif. 3d Ct. App. 2007). Roby, a 25-year McKesson employee, was regarded as stellar worker until she developed a panic disorder in 1998. She missed work because of severe panic attacks and trips to a psychiatrist. Evidence showed that her manager, Karen Schoener, singled her out for public humiliation, going out of her way to ostracize Roby. The Court of Appeal found that Schoener’s scorn and lack of sympathy toward the disability were insufficient to trigger hostile work environment liability under the FEHA. The court cut the punitive damages and threw out the harassment portion of the verdict. Roby’s lawyer, David deRubertis of the deRubertis Law Firm in Woodland Hills, Calif., said case law holds that individual managers are immune from discrimination liability because it falls on the company. Employers are simply trying to expand that immunity for harassment as well. In McKesson, “certain acts by Schoener were not legitimate management,” deRubertis said. One side effect of Roby’s disability was body odor resulting from her medication. Responding to co-worker complaints, her supervisor asked Roby to remedy the problem by adjusting a fan, according to McKesson’s lawyer, Dipanwita Amar of Howard Rice Nemerovski Canady Falk & Rabkin in San Francisco. McKesson will determine what constitutes harassment, Amar said. Plaintiffs can’t turn a discrimination claim, with no personal liability for supervisors, into a harassment claim, which can carry personal liability, Amar said. “These decisions will apply to any employer in California, even if their headquarters are elsewhere.” The California Supreme Court may clarify the standard for retaliation in the case, which is likely to be argued in the middle of next year.

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