The California Supreme Court's recent ruling in the case of People ex rel. Garcia-Brower v. Kolla’s, Inc. (2023) has significantly strengthened whistleblower protections for employees in the state. By addressing and clarifying the interpretation of Labor Code section 1102.5(b), which safeguards employees from retaliation when reporting unlawful activity, the court has expanded the scope of protection to include situations where the employer already possesses knowledge of the disclosed information. This decision not only provides employees with increased legal safeguards but also underscores the importance of upholding their rights and holding employers accountable for any retaliatory actions.
The case involved a bartender employed at a nightclub in Orange County who faced severe consequences after raising concerns about unpaid wages for her previous shifts. The owner not only threatened to report her to immigration authorities but also terminated her employment. Seeking justice, the bartender filed a complaint with the Division of Labor Standards Enforcement, which found that the owner's actions violated multiple provisions of the Labor Code. The Labor Commissioner invoked Labor Code section 1102.5(b) to hold the employer accountable for retaliation.
Initially, both the trial court and the Court of Appeal ruled against the Labor Commissioner's claim under section 1102.5(b). The Court of Appeal argued that a disclosure should involve sharing new or believed-to-be-new information. Since the bartender did not reveal anything unknown to the owner, her claim was dismissed. However, the California Supreme Court took a different stance.
In a unanimous decision, the California Supreme Court emphasized that Labor Code section 1102.5(b) extends protection to employees, even when they report information already known to the recipient. While acknowledging that "disclosure" typically implies sharing previously unknown information, the court argued that the term can also include presenting information within a specific context, especially when the discloser possesses unique access to it. The court relied on the legislative history of section 1102.5(b) to support this broader interpretation of "disclose."
Importantly, the court's ruling also considered the interests of employers. It stressed that employers can still defend against retaliation claims if they can provide clear and convincing evidence that the alleged retaliatory action would have occurred for legitimate reasons unrelated to the employee's protected activity.
The Supreme Court's decision in People ex rel. Garcia-Brower v. Kolla's, Inc. expands whistleblower protections in California, offering employees increased legal safeguards when reporting unlawful activities that are already known by the employer. To navigate potential retaliation claims, both employers and employees are advised to seek qualified legal counsel to ensure they receive up-to-date and competent representation in accordance with current California law.