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Carol Was Ready to Retire and Wanted to Pad Her Retirement Savings with a Bogus Lawsuit Against Her Employer

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Discrimination and harassment are illegal only if done because of the worker's membership in a protected group or because the worker engaged in a protected activity. But for unemployment insurance, an intolerable workplace for any reason is enough to qualify

Carol had worked at Encino Partners for about 15 years. She wasn't the most productive employee and her boss wasn't a patient, polite person, but they got along and tolerated each other. Carol was in her mid-60s and planned to retire. She told her boss about her plans and also a lot of other people.

Carol told her coworkers and even friends working in other offices in the same building that she planned to retire soon. She told Encino Partners' customers that she planned to retire soon. She told the FedEx delivery man that she planned to retire soon. She eventually chose a date and then had a small party that her boss hosted at the office. Then Carol began traveling and stayed with relatives in Miami Beach for a few months, then Boston, and then Napa.

About six months after she retired, Carol filed multiple complaints with DFEH, the California Division of Labor Standards Enforcement and the Unemployment Insurance Appeals Board. The complaints alleged age discrimination. She said that her boss fired her because she was old and he wanted a younger worker. The complaints also alleged that her boss was mean, insulting and had a short temper.

Sean Olender represents employees and employers in employment law disputes and in this case, Sean represented the employer. Before taking a case, Sean interviews the potential client, reviews the evidence and decides whether the employee has been wronged or not. In this case, there were many witnesses who had no relationship with Encino Partners who confirmed that Carol told them that she planned to retire and wanted to retire. Encino Partners did not want to find a new employee and had evidence that it did not start looking for one until after Carol announced her retirement plans. Encino Partners was a very small business. Training a new employee for this job was not only an administrative burden, the company had no one to perform the training and wasn't even sure how Carol performed all of her job duties. This meant that Carol's age discrimination claims were likely false and arguably perjury. Making false claims of discrimination damages the integrity of the DFEH and court system. Here, it was obvious that Carol miscalculated her retirement budget and decided to try to supplement it with a false claim.

But Carol also made a claim for unemployment benefits. And this claim requires a different standard of proof. To qualify for unemployment benefits even if an employee quits, the employee must prove that the workplace was intolerable to an ordinary employee - that is to say that it was so unpleasant that a reasonable employee would have quit to avoid it. Sean delicately explained to the owner of Encino Partners that as a result of his investigation he concluded that the owner really was a difficult person to work for and he had a habit of losing his temper and raising his voice at Carol, his vendors and even his customers and that witnesses would confirm this. Sean advised Encino Partners to not appeal the unemployment decision because Carol was entitled to unemployment benefits because the workplace was unpleasant.

But Sean also advised Encino Partners that Carol's age discrimination claims would fail and they did not need to negotiate or settle those claims with Carol.  With Encino Partners' permission, Sean called Carol and talked with her about the case ultimately explaining to her that she ought to find an attorney to represent her, but that unless she could explain facts that tended to show age discrimination, it would be difficult to find a lawyer who would represent her on a contingency fee basis.

Encino Partners and Carol ultimately resolved the case by Carol not further pursuing the age discrimination claims and Encino Partners not further seeking to limit Carol's unemployment insurance award. This was a just result because the facts supported it.

This case illustrated an important divergence in employment law and unemployment insurance eligibility. Generally, an employee has no legal claim for being treated impolitely at work. If the employee's manager or supervisor raises her voice, uses profanity, is rude, unfair, or just incompentent. It does not matter if the employee is right and his supervisor is not. There is generally no employment law claim for suffering an unpleasant workplace.

Many workers have heard the term "hostile work environment" and assume that it refers to any harassment, rudeness, unfairness, or other mistreatment. It does not. To sustain a legal action against her employer, an employee must demonstrate that she was discriminated against or retaliated against on the basis of:

  • Age
  • Sex
  • Sexual Orientation
  • Race
  • Ethnicity
  • National Origin
  • Religion
  • Disability
  • Pregnancy
  • Engaging in a Protected Activity (like reporting an unsafe workplace, or any legal violation)

To sustain a claim for discrimination, the employee must demonstrate that her membership in one of the classes of persons above or engaging in a protected activity was a substantial factor in the employer's decision to discriminate. The discrimination must also result in an adverse employment action, except for disability discrimination employers are liable also for failing to engage the employee in an interactive process, which is a conversation that seeks to find a reasonable accommodation for the employee's disability that will allow her to perform the essential functions of her job. An adverse employment action may be as little as giving a better office to another employee, or something as serious as a large pay differential or termination that is on the basis of membership in one of the listed groups.

But for unemployment insurance, the standard is different. The question for unemployment insurance is whether the workplace is intolerable regardless of the reason for it. If a workplace is intolerable because of a manager's meanness, because of the use of profanity, subjecting employees to rude or demeaning treatment like insults or disciplinary action in front of customers or other employees, that is usually sufficient to make the workplace intolerable and qualify the employee for unemployment insurance benefits.

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