Can employer fire employees in a post-Covid ‘reorganization’?

Q:        I work for a mid-size company in Los Angeles. Because of the COVID pandemic, I, together with half of our work force, worked from home for over a year. Now, we are returning to the worksite. However, management has told us that there will be a “reorganization” and some employees will not be asked to come back and will be let go. I was one of these persons who was told not to come back. After talking with other co-workers, it seems the company laid off workers who have the highest pay (most of them older), and workers who have had some medical condition. I am an older worker and I had taken medical leave months prior to the lockdown for a heart surgery. What are my rights?

A:        In California, employment is generally “at-will.” This means that either the employer or the employee may end the employment relationship at any time. An employee can quit their job for any reason at any time. Likewise, the employer may terminate the employee at any time, even if the employee’s job performance was excellent. The employer may also terminate employees for unfair reasons such as nepotism or favoritism. Or the employer may terminate employees for business reasons, such reorganization or eliminating job positions. The employer may even terminate the employee for no reason at all.

However, an employer is prohibited from firing an employee due to a discriminatory or retaliatory reason. Discriminatory intent exists when an employee was terminated because of their protected characteristics such as age, race, sex, color, national origin, disability, medical condition, pregnancy, religion, and even union affiliation. A retaliatory intent exists if the employer fires the employee for engaging in a “protected activity” such as registering internal complaints regarding the safety of the employer’s products or for exercising a legal right such as taking a medical leave. Where discrimination or retaliation can be proven, the employee may have a claim for wrongful termination.

As employees return to work after the lifting of the stay at home order and after a long absence from the worksite, employers may be legitimately re-evaluating their staffing needs post-COVID. It may be true that they are streamlining and doing away with superfluous or more expensive positions as a business necessity.

However, COVID or not, employers must continue to comply with existing laws regarding age and disability under the California’s Fair Employment and Housing Act (FEHA) and the Americans with Disabilities Act (ADA). An employer’s policy and conduct must not result in either disparate impact or disparate treatment against employees.

Disparate impact is often referred to as unintentional discrimination. Employer policies, practices, or decisions may appear to be neutral but result in a disproportionate impact on a protected group. In the inquiry above, the employer’s stated intent to eliminate higher paid employees may sound neutral on its face and can be justified as a business decision. However, if it results in the firing of a disproportionately large number of employees older than 40 years old to be replaced by cheaper but also younger employees, the supposedly neutral business decision may in fact be age discrimination.

On the other hand, disparate treatment is intentional discrimination. This means the employer has intentionally singled out a protected class of employees and subjected them to adverse action. In the inquiry above, the employer’s conduct of firing employees who have a medical condition or who took medical leave may be considered disability or medical condition discrimination.

As employers resume normal operations, existing laws as well as newly enacted ones are in place to protect workers. For example, in certain industries, laid-off employees have the legal right to be recalled to their former jobs or to any open position for which they could be trained to do. Where employers are asking some employees not to return to work but instead are hiring new ones, one must ask whether the employer is engaging in discrimination. It would certainly benefit an employee in this situation to consult with experienced employment counsel to protect themselves.

The Law Offices of C. Joe Sayas, Jr. welcomes inquiries about this topic. All inquiries are confidential and at no-cost. You can contact the office at (818) 291-0088 or visit www.joesayaslaw.com. [For more than 25 years, C. Joe Sayas, Jr., Esq. has successfully recovered wages and other monetary damages for thousands of employees and consumers. He was named Top Labor & Employment Attorney in California by the Daily Journal, consistently selected as Super Lawyer by the Los Angeles Magazine, and is a past Presidential Awardee for Outstanding Filipino Overseas.]