California Supreme Court Expands Employee Whistleblower Protections

Suppose you are an employee who has made a whistleblower complaint to your employer. In that case, you should know that you are protected under the whistleblower statute (California Labor Code § 1102.5(b)) even if your employer already knew about the subject of your complaint. This means that employers are not allowed to retaliate against employees who make whistleblower complaints, regardless of whether they had prior knowledge of the alleged violation. Therefore, it’s essential to know your rights as an employee and to speak up if you witness any illegal activity in the workplace.

The court’s decision in People ex rel. Garcia-Brower v. Kolla’s, Inc (May 22, 2023) was a significant one. It all started with a bartender complaining to her employer about unpaid wages for three shifts she had worked at Kolla’s Inc., a nightclub in Orange County, California. Unfortunately, instead of addressing the issue, the owner of the nightclub threatened to report the employee to immigration authorities, fired her, and told her never to come back. The employee then filed a complaint with the California Department of Labor Standards Enforcement (DLSE), which found that the nightclub had unlawfully retaliated against her. When the nightclub refused to pay damages, the California Labor Commissioner took legal action, suing for various violations, including unlawful retaliation under Section 1102.5(b). Businesses must treat their employees respectfully and follow the law to avoid consequences like these.

The Labor Commissioner’s claim for retaliation was denied by both the trial court and the court of appeal. They ruled that the bartender’s complaint did not fall under the protected category of “disclosure” according to Section 1102.5(b). This was because a disclosure requires the revelation of something new or believed to be new to the person or agency it is made to. Since the nightclub was already aware of its failure to pay the employee’s wages, the complaint did not meet the criteria for a “disclosure.”

The California Supreme Court determined that “disclosure” under Section 1102.5(b) includes protection for disclosures made to another employee with the authority to investigate or correct the violation, regardless of whether the recipient is aware of the offense. This means that the nightclub’s actions in threatening to report the employee to immigration authorities, terminating her employment, and instructing her not to return to work constituted unlawful retaliation under Section 1102.5(b), even if the nightclub did not know about its failure to pay the employee for wages earned.

As per the updated interpretation of “disclosure” under Section 1102.5(b), California employers must ensure that employees who report a whistleblower complaint are not subjected to any form of retaliation, regardless of whether the employer was already aware of the issue.

Helmer Friedman LLP helping you navigate through the state and federal whistleblower programs that may reward you for reporting fraud.

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