The California Supreme Court recently determined that employers may be held liable for acts of discrimination and harassment that took place years ago, and which might otherwise be barred by the applicable statute of limitations. Until the Court's decision, employees were often unable to introduce evidence of any wrongful acts which occurred outside the relevant limitations period, even though those acts may have been part of the continuing pattern of conduct giving rise to an employee's claims. With this ruling, the Court greatly expanded the right of employees to sue for discrimination and harassment based on a series of events taking place over a prolonged period of time.

Richards v. CH2M Hill, Inc.

In Richards v. CH2M Hill, Inc., 01 C.D.O.S. 7347 (8/23/01), the California Supreme Court addressed claims brought by plaintiff-Richards against CH2M Hill, her former employer. Richards complained that CH2M Hill discriminated against and harassed her on the basis of her disability in violation of the California Fair Employment and Housing Act ("FEHA"). According to Richards' complaint, CH2M Hill's inappropriate conduct commenced in 1988 when she first asked the company to accommodate her physical disabilities resulting from multiple sclerosis, and continued until her resignation in 1993. Richards argued that from 1988 to 1993 she sought a variety of accommodations to allow her to perform the essential functions of her job, and that CH2M Hill purported to consider and implement a number of those accommodations. However, according to Richards, even though CH2M Hill ultimately made some accommodations, it took far too long considering and effectuating her requests, thus forcing her to repeat them over and over again. Richards contended that the company's failure to timely implement many of the agreed-upon accommodations, as well as the fact that it ignored or denied a number of other accommodation requests, constituted both harassment and discrimination on the basis of her disability.

In its defense, CH2M Hill asserted FEHA's one year statute of limitations, claiming that Richards could only seek damages for acts occurring during the one-year period preceding the filing of her claim. In response, Richards argued that CH2M Hill's actions constituted a "continuing violation" of FEHA, so that the discriminatory and harassing acts which took place within and outside the limitations period actually constituted a single violation that should be considered by the court in its entirety.

The trial court determined that the company's conduct from 1988 to 1993 constituted a continuing violation, and allowed evidence of discriminatory and harassing acts committed throughout that period to be introduced at trial. At the conclusion of the trial, a jury awarded Richards approximately $1.5 million in damages. On appeal, California's Third District Court of Appeal reversed the trial court's findings, agreeing with CH2M Hill's argument and concluding that the majority of Richards' claims were time-barred pursuant to FEHA's one year statute of limitations.

The California Supreme Court reversed again, finding that the doctrine of continuing violations may toll the applicable statute of limitations if an employer's unlawful actions can be viewed as a "single, actionable course of conduct."

The Court set forth a three-part test for determining when a series of unlawful acts may be viewed as a single actionable course of conduct, thus being deemed a "continuing violation": 1) the discriminatory acts must be sufficiently similar; 2) the discriminatory acts must occur with sufficient frequency; and, 3) the discriminatory acts must not acquire a degree of permanence such that the employee is on notice that further efforts at informal resolution with the employer would be futile. If each of these three prongs is satisfied, a court may consider all discriminatory acts alleged by a plaintiff, including those that would otherwise be time-barred. Specifically, the Richards Court concluded that, "The statute of limitations begins to run not necessarily when the employee first believes that his or her rights may have been violated, but rather either when the course of conduct is brought to an end, as by the employer's cessation of such conduct or by the employee's resignation, or when the employee is on notice that further efforts to end the unlawful conduct will be in vain."

With respect to the particular claims before it, the Court concluded that Richards may have been led to believe over a period of several years that her employer was considering her various requests for accommodation. If that was the case, Richards was not put on notice that there would be no further efforts on the part of CH2M Hill to resolve the dispute, and the statute of limitations therefore would not bar evidence of the company's earlier discriminatory and harassing acts. Because neither the trial court nor the Court of Appeal had applied the proper standard for determining whether a continuing violation had occurred, the matter was remanded to the trial court for a fact-specific inquiry into whether the three-prong test established by the Court had been satisfied.

What Does This Mean for California Employers?

The California Supreme Court's decision opens the door for many claims that would otherwise have been time-barred. The impetus behind the Court's decision appears to be the public policy supporting an employee's right to seek an accommodation (or other remedy) without fear that the clock will run out on the right to assert a legal claim. It is also worth noting that although Richards dealt specifically with allegations of disability-related harassment and discrimination, the three-prong test established in this case will likely be deemed applicable to other types of discrimination and harassment claims in which continuing violations are at issue.

As a result of the Richards decision, employers are now faced with the additional challenge of balancing their obligation to participate in the interactive accommodation process against the need to avoid tolling the statute of limitations on an employee's potential claim for discrimination or harassment. One way to minimize the likelihood that an employee can successfully assert that conduct constitutes a continuing violation is to make clear when the interactive process has concluded. If an employer clearly states that further accommodations will not be provided or considered, an employee is on notice that litigation, not informal conciliation, is the only alternative for the vindication of his rights. It is at that point that the statute of limitations for any violations begins to run. Whether it is appropriate for an employer to advise an employee that no further accommodation will be considered necessarily requires a case-specific analysis. Given the complexity of the issues which may be raised, employers are urged to direct any concerns regarding these issues to legal counsel.