WCAB’s Denial of 132a Claim Does Not Bar Civil Claim Under FEHA

Generally, workers’ compensation is the exclusive remedy for injuries occurring at the workplace. A worker normally must pursue claims for work-related injuries before the Workers’ Compensation Appeals Board (WCAB) rather than sue the employer in civil court.Nevertheless, certain types of intentional conduct take the employer beyond the boundaries of the compensation bargain. In City of Moorpark v. Superior Court of Ventura County (Dillon) (1998) 18 Cal.4th 1143, the California Supreme Court held that discrimination falls outside of the compensation bargain. It concluded that Labor Code 132a does not provide the exclusive remedy for discrimination based on a work-related injury.

An employee may bring a claim for discrimination under LC 132a, which prohibits “discrimination against workers who are injured in the course and scope of their employment.” Claims under LC 132a are adjudicated at the WCAB. An employee also may pursue a claim under the California Fair Employment and Housing Act (FEHA), which prohibits discrimination against an employee on multiple grounds, including discrimination based on physical and mental disabilities. FEHA claims are pursued in civil court.

But in City of Moorpark, the Supreme Court stated, “Because the standards for establishing disability discrimination may well be different under the FEHA than under section 132a, a decision in an employee’s favor on a section 132a petition would not establish a FEHA violation.” (City of Moorpark, 18 Cal.4th at 1158.) In a recent case, Kaur v. Foster Poultry Farms LLC (2022) 83 Cal. App. 5th 320, the 5th District Court of Appeal held that the opposite was also true –– a decision in the employer’s favor in an LC 132a action did not bar an FEHA claim.

Facts of the Case

In Kaur, an employee was terminated after she sustained an industrial injury. The sole reason for her termination was that she chose not to accept the one accommodation offered by the company. The employee filed a petition asserting discrimination under LC 132a. She also filed civil claims asserting violations under the FEHA.

After the WCAB denied the 132a petition, the employer moved for summary judgment on the civil claims, asserting that all the employee’s disability-related claims were barred by res judicata and collateral estoppel. The trial court granted summary judgment, holding that the WCAB opinion barred the employee’s disability-related and other claims under FEHA.

The Court’s Decision

The 5th District Court of Appeal held that the WCAB’s decision did not bar the employee’s civil claims under the FEHA. It explained that collateral estoppel precludes re-litigation of issues argued and decided in prior proceedings or a prior case, even if the second suit raises different causes of action. It explained, however, that collateral estoppel applies only if five threshold requirements are satisfied:

1. The issue sought to be precluded from re-litigation must be identical to that decided in a former proceeding.
2. The issue actually must have been litigated in the former proceeding.
3. It must have been decided in the former proceeding.
4. The decision in the former proceeding must be final and on the merits.
5. The party against whom preclusion is sought must be the same as, or in privity with, the party to the former proceeding.

The court added that the party asserting collateral estoppel bears the burden of establishing those requirements.

The court explained that LC 132a proscribes a relatively narrow range of discriminatory conduct by employers, that the FEHA targets a much broader range of discriminatory conduct, and imposes affirmative duties on employers as to disabled employees. The employee’s FEHA claims for disability discrimination, failure to provide reasonable accommodation and failure to engage in a good-faith interactive process involved entirely different inquiries and issues from her claims under LC 132a. They encompassed a whole range of affirmative duties and other requirements applicable to the employer (for example, continuing obligations to make reasonable accommodations and engage in an interactive process), as well as benefits that accrue to the employee (for example, preferential treatment with regard to open positions) that had no relevance to an LC 132a proceeding.

The court concluded that the issues decided in the LC 132a proceeding were not identical to the issues implicated in the FEHA claims for disability discrimination, failure to provide reasonable accommodation and failure to engage in an interactive process. It reversed the trial court’s decision to grant summary judgment.

Analysis of the Decision

The decision will make it very difficult for employers to assert that decisions in their favor in a 132a action preclude litigation in civil courts for discrimination under the FEHA. The scope of the analysis for 132a claims is different from that for FEHA claims.

That’s not to say that a 132a decision can never be collateral estoppel in a FEHA claim. In fact, Justice Poochigian wrote a concurring decision stating that the majority’s decision “does not stand for the broad proposition that factual findings by an administrative law judge (ALJ) on a claim under Labor Code Section 132a can never supply the basis for issue preclusion in a subsequent [FEHA] action.” Nevertheless, the FEHA allows independent causes of action for disability discrimination, failure to provide a reasonable accommodation and failure to engage in the interactive process, and an injured worker may avoid collateral estoppel by pleading a cause of action that’s beyond the WCAB’s review in a 132a action.

Although this potentially opens the door to double recovery by an injured worker, the Supreme Court sought to address that in City of Moorpark, stating that “to the extent section 132a and the FEHA overlap, equitable principles preclude double recovery for employees.” It explained, “For example, employees who settle their claims for lost wages and work benefits as part of a section 132a proceeding could not recover these damages as part of a subsequent FEHA proceeding.” (City of Moorpark, 18 Cal.4th at p. 1158.) The WCAB, however, has placed the burden on employers to show double recovery and has refused to allow credit when it’s not established.

The Kaur decision is available on the California Court’s website at: https://www.courts.ca.gov/opinions/documents/F081786.PDF.

About the Author

Sure Log, of Counsel, is a specialist in workers’ compensation defense and related labor law issues. He analyzes files for litigation and settlement, conducts research, reviews records to facilitate completion of discovery and drafts a variety of documents, including trial and appellate briefs. He was instrumental in a 2009 case that ended vocational rehabilitation in California.

IEA traces its history to our predecessor organization, “The Fire Underwriters Association of the Pacific” (FUAP) created in 1876 in San Francisco, CA after the post Gold Rush building boom.  Its stated purpose was the promotion of harmony and good practice among the claims adjusting profession. Over time, we became an all industry, all-lines organization with national outreach across the United States.

Today, we are committed to providing professional development to a changing workforce with changing needs. IEA offers myriad courses, seminars, and on-demand training to meet our students where they are and help them reach their goals. We are proud of our contribution to better risk analysis and high operating standards in the industry.