Flait v. North American Watch Corp.
3 Cal. App. 4th 467, 92 Daily Journal DAR 1843, 4 Cal. Rptr. 2d 522 (1992)
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Rule of Law:
An employee may establish a prima facie case of retaliatory termination under the California Fair Employment and Housing Act (CFEHA) if they can show they were discharged for opposing what they reasonably, sincerely, and in good faith believed to be unlawful harassment, even if the harassment itself is not ultimately proven to have been legally actionable.
Facts:
- Stuart Flait began working as a sales representative for North American Watch Corporation (NAWC) on February 1, 1984.
- Flait supervised a marketing representative named Pamela Berger.
- In March 1987, Berger complained to Flait that their supervisor, John Pistner, had used a vulgar slang term for female genitals in front of other employees.
- Flait subsequently confronted Pistner multiple times throughout 1987, telling him it was improper to make sexual comments and to cease bothering Berger, following reports from Berger about additional crude sexual remarks Pistner had made.
- Flait believed Berger felt harassed and that the problem was creating a hostile work environment for her, feeling responsible as her supervisor, especially since NAWC had no established policy or guidelines for harassment complaints.
- Despite Flait increasing NAWC’s sales by 58 percent in 1987, Pistner decided to terminate Flait's employment in early January 1988, claiming Flait was not a 'company man' and citing continuous dissatisfaction with his performance, though Pistner could not recall reviewing Flait's sales record or discussing prior dissatisfaction with others.
- Upon termination, Flait told NAWC President James Reilly that he believed he was being fired for protesting Pistner’s abuse of Berger, but Reilly did not investigate further after Pistner denied the allegations.
- After Flait's termination, Berger provided a handwritten statement confirming Pistner's offensive behavior and her reporting it to Flait, stating she resigned because she was unable to tolerate the harassment, although during deposition she later attempted to diminish this statement due to fear and anger about being involved in Flait's lawsuit.
Procedural Posture:
- Stuart Flait filed a complaint with the Department of Fair Employment and Housing and received a 'right to sue' letter.
- In April 1988, Flait filed a lawsuit against North American Watch Corporation (NAWC) in the state trial court (court of first instance), alleging retaliatory termination in violation of CFEHA, among other claims.
- In December 1990, NAWC filed a motion for summary adjudication of issues.
- In January 1991, the trial court granted summary adjudication in favor of NAWC on several issues, including that Pamela Berger was not sexually harassed, Flait could not have reasonably believed she was harassed, and Flait was terminated for good cause.
- In February 1991, NAWC filed a motion seeking entry of judgment and an award of attorney's fees and costs.
- On March 4, 1991, the trial court entered judgment for NAWC and awarded NAWC attorney's fees and costs of $153,957.61.
- Flait (appellant) appealed the trial court's judgment.
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Issue:
Does the California Fair Employment and Housing Act (CFEHA) protect an employee from retaliatory termination for opposing a supervisor's alleged sexual harassment of a coworker, even if the coworker later denies being harassed, provided the employee's belief was reasonable and in good faith?
Opinions:
Majority - Boren, J.
Yes, an employee can prevail on a retaliatory termination claim under CFEHA if they had a reasonable, good faith, and sincere belief that they were opposing unlawful harassment, even if the harassment is not ultimately proven. The court found that lawsuits claiming retaliatory termination under CFEHA are analogous to federal Title VII claims and are evaluated under a three-part framework: (1) the plaintiff establishes a prima facie case of retaliation, (2) the defendant articulates a legitimate nonretaliatory explanation, and (3) the plaintiff shows the explanation is a pretext. To establish a prima facie case, the plaintiff must show protected activity, adverse employment action, and a causal link. The court emphasized that the critical inquiry for 'protected activity' is the employee's good faith and reasonable belief that they were opposing unlawful harassment, not whether the harassment actually occurred or was sufficiently severe/pervasive. Supervisors like Flait have a statutory duty under CFEHA to take immediate and appropriate corrective action when harassment is brought to their attention. The court found that Flait presented sufficient triable issues of fact regarding his reasonable belief, the causal link between his opposition to Pistner's conduct and his termination (due to the timing and Pistner being the sole decision-maker), and that NAWC's stated reasons for termination (not being a 'company man,' customer allegiance, sales deficiencies) could be a pretext given Flait's strong sales performance and NAWC's concession that it controlled customer orders. The court also clarified that claims for emotional distress arising from CFEHA violations are not barred by the workers' compensation act. However, Flait's claim for breach of the implied covenant of good faith and fair dealing failed because he was an at-will employee and presented no evidence of a contractual term or company policy violated by his termination.
Analysis:
This case significantly broadens the protections afforded to employees under CFEHA, particularly those in supervisory roles, by clarifying that a good faith and reasonable belief in opposing harassment is sufficient for a retaliation claim, regardless of whether the underlying harassment is definitively proven. It reinforces the statutory duty of supervisors to take immediate corrective action against harassment and discourages employers from using vague performance criticisms as a pretext for termination. The decision underscores the importance of employers establishing clear anti-harassment policies and procedures, as their absence can support an employee's claim of appropriate direct action. Future cases will likely cite this precedent to lower the evidentiary burden for plaintiffs in proving the 'protected activity' element of retaliation claims, shifting the focus from the objective reality of harassment to the employee's subjective, but reasonable, perception.
