Beware of Equitable Tolling Stretching the Statute of Limitations Even Further

Mar 02, 2020

By Nicholas Grether, The Maloney Firm, APC

By now, California employers should be aware that AB 9 extended the deadline for employees to file a claim with the Department of Fair Employment and Housing (DFEH) from one year to three years. Employees may now file claims such as harassment, discrimination, and retaliation with the DFEH up to three years after the alleged unlawful acts. Employers should also be aware that in some cases, the statute of limitations can be extended even further through the doctrine of “equitable tolling.” A recent California Court of Appeals case found that the pendency of an employee’s workers’ compensation claim could toll the statute of limitations, extending the time allowed to pursue claims for discrimination, harassment, and retaliation.

Brome v. California Highway Patrol

In the case of Brome v. California Highway Patrol (See note 1), a CHP officer claimed to have been subjected to harassment and retaliation during his nearly 20-year career. In January 2015, the officer went on medical leave and filed a workers’ compensation claim due to stress allegedly caused by the harassment he claimed to have endured. After resolving the workers’ compensation claim in October 2015, he took disability retirement in February 2016. The officer then filed a claim with the Department of Fair Employment and Housing (“DFEH claim”) in September 2016, received an immediate right to sue, and filed a lawsuit the next day claiming discrimination, harassment, and retaliation.

Prior to 2020, the officer would have only been able to rely on incidents dating back one year (i.e., incidents that occurred after September 2015) to support his claims. In the CHP’s view, since he was off work on a medical leave as of January 2015, he certainly could not prove that he was harassed by any employee of the CHP after September 2015. However, the appeals court ruled that by pursuing one remedy out of a number of options (in this case a claim of workers’ compensation) the officer could claim an extension of the statute of limitations using equitable tolling (See note 2). This allowed the officer to rely on alleged unlawful acts dating back to December 2014, prior to his medical leave. To meet the standard for equitable tolling, a plaintiff must show timely notice, a lack of prejudice to the defendant, and reasonable and good faith conduct by the plaintiff.

The appeals court was persuaded that the officer had established a triable issue of fact as to whether the statute of limitations could be equitably tolled. First, the officer alleged that harassment at work caused his stress in his workers’ compensation claim, and his supervisors understood that he was complaining about discrimination. Thus, he could show that his workers’ compensation claim put the CHP on notice about what was then alleged in the DFEH claim. Second, the court found that since the CHP’s investigation into the workers’ compensation claim put it in a position of investigating similar claims to the DFEH claim, any prejudice to the CHP would be minimal. The CHP had the opportunity to interview witnesses and gather facts related to the DFEH claim. Third, the court found Brome waiting 11 months to file the DFEH claim after the workers’ compensation claim was not irrefutable evidence of bad faith (See note 3). The appeals court denied the CHP’s motion for summary judgment and the officer’s claims are again pending before the trial court.

Lessons for Employers

The case provides several lessons for employers. First, the legislature’s extension of the statute of limitations and potential for equitable tolling emphasize the need to have an organized data retention policy. Employers do not want to be in the position of having destroyed or being unable to locate evidence if litigation commences 4+ years later.

Second, employers must conduct thorough investigations when an employee feels mistreated, discriminated against, or harassed, even in connection with a workers’ compensation claim. A court may find that work-related stress puts an employer on notice about harassment, so interviewing witnesses and gathering the key evidence will put the employer in a better position if the employee later pursues civil claims of harassment or retaliation.

Third, employers need to respond to their employee’s complaints and attempt to address them. The facts in Bromemade for a sympathetic plaintiff since he had complained about harassment and discrimination on several occasions to no avail.

Fourth, any time there is a workers’ compensation claim, the employer should be on the lookout for potentially helpful information for use in a subsequent lawsuit.

Lastly, we note that court might be less likely to apply equitable tolling when an employee or former employee misses the now three-year deadline to file a claim with the DFEH. However, if the plaintiff has pursued other remedies, such as workers’ compensation, it is possible that the statute of limitations will not provide an absolute defense.

Notes:
1. Appellate No. A154612, Solano County Super. Ct. Case No. FCS047706.
2. Since the officer’s workers’ compensation claim was pending for 285 days, the court found that the officer could also rely on his allegations for the 285 days before September 2015, stretching his claims into December 2014 when he was still working and allegedly subjected to harassment, discrimination, and retaliation.
3. We note the court found that the officer established a triable issue of fact on equitable tolling, not that he was entitled to it as a matter of law. The trial court may find that the officer did not act in good faith or that the CHP did not have notice of the potential DFEH claims. Even so, the court’s ruling is illustrative of potential pratfalls for California employers.

About the Author:

Nicholas Grether is an employment attorney in the Employment Law Department at The Maloney Firm, APC. If you have questions regarding this alert, contact Nicholas Grether at ngrether@maloneyfirm.com.


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