California Court Holds Supervisors Are Not Individually Liable for Whistleblower Retaliation

A newly published California Court of Appeal decision provides important clarification for employers and managers facing whistleblower-retaliation claims under Labor Code section 1102.5: supervisors cannot be held personally liable for retaliation under the statute.

On September 28, 2026, the First District Court of Appeal issued its published decision in Chaudhry v. State of California, No. A173501. In an issue of first impression for California appellate courts, the court held that Labor Code section 1102.5 does not impose personal liability on individual supervisors for whistleblower retaliation.

Although Chaudhry involved a state employee and addressed several procedural rules specific to public employment, its analysis of section 1102. applies beyond the public sector and is significant for private employers throughout California.

Why Was Individual Liability Unclear?

Labor Code section 1102.5 is California’s primary whistleblower-protection statute. Among other things, it prohibits an “employer, or any person acting on behalf of the employer” from retaliating against an employee for certain protected disclosures of suspected legal violations.

The phrase “any person acting on behalf of the employer” created an ambiguity that courts and litigants have grappled with for years: Does that mean a manager who allegedly retaliates against a whistleblower can be sued personally?

The Chaudhry court acknowledged that the statutory language could reasonably be read that way, but the court concluded that the phrase cannot be viewed in isolation. Looking at the statutory scheme as a whole, the court found that the Legislature intended liability for workplace retaliation to fall on the employer, rather than individual supervisors.

One significant clue was Labor Code section 1102.6, which establishes the burden of proof in a section 1102.5 retaliation case. Once an employee establishes that protected activity was a contributing factor in an adverse employment action (e.g., termination, demotion, etc.), section 1102.6 places the burden on “the employer” to prove by clear and convincing evidence that it would have taken the same action for legitimate, independent reasons. The statute does not provide a corresponding defense or burden of proof for an individual supervisor. The court reasoned that it would make little sense for the Legislature to impose liability on supervisors while failing to address them in the statute governing how such claims are proved.

Individual Liability Has Long Been Limited in Similar Employment Claims 

For nearly two decades, California law has barred individual supervisor liability for retaliation under California’s Fair Employment and Housing Act (FEHA).  The Chaudhry court relied heavily on the California Supreme Court’s decision in Jones v. Lodge at Torrey Pines Partnership (2008) 42 Cal.4th 1158, which established that rule.

In Jones, the Supreme Court held that supervisors are not individually liable for retaliation under FEHA, even though FEHA’s retaliation provision refers to conduct by a “person.” And the rule against individual liability for FEHA discrimination is even older: a decade before Jones, the Supreme Court held in Reno v. Baird (1998) 18 Cal.4th 640 that supervisors cannot be held personally liable for employment discrimination under FEHA.

The Chaudhry court found much of that reasoning equally applicable to section 1102.5. Supervisors necessarily make personnel and management decisions—such as discipline, performance management and termination—that can later become the basis of a retaliation claim. Imposing personal liability for those decisions could place supervisors’ personal assets at risk and create conflicts of interest between supervisors and their employers.

The court reasoned that the Legislature also knows how to impose individual liability expressly when it wants to. FEHA, for example, expressly provides for individual liability for workplace harassment. Section 1102.5 contains no comparable language expressly making supervisors personally liable for retaliation.

What About the “Any Person” Language?

Importantly, the court did not treat the words “any person acting on behalf of the employer” as meaningless.

The Legislature added that language in 2013 as part of legislation aimed in part at preventing retaliation involving third parties, including attorneys who threatened employees with immigration-related consequences. But the legislative history contained no indication that the amendment was intended to expose individual managers or supervisors to personal civil liability.

The court explained that the language can still have effect without imposing personal liability on supervisors—for example, by reaching other persons acting on an employer’s behalf or by making employers responsible for retaliatory actions taken through such persons.

What This Means for California Employers

Chaudhry removes an important area of uncertainty surrounding California whistleblower claims. Employees may continue to pursue section 1102.5 retaliation claims against their employers, but they may not impose personal liability on individual supervisors under section 1102.5 merely because those supervisors participated in the challenged employment decision. The court noted that its holding also aligns with more than 30 federal district court decisions that had previously reached the same conclusion.

The decision does not, however, reduce an employer’s potential liability for a supervisor’s actions. Employers should continue to ensure that managers understand California’s broad whistleblower protections and that subsequent personnel decisions are based on legitimate reasons unrelated to an employee’s protected complaint.

For employers, the practical lesson remains straightforward: document legitimate reasons for employment decisions, involve HR or counsel when protected complaints precede disciplinary action, and make sure managers understand that retaliation remains prohibited even though section 1102.5 does not make them personally liable.