With little public recognition in light of the ongoing pandemic-related legislation, Governor Newsom recently approved AB 1947 – legislation that will have significant impact on employers. AB 1947 amends two specific provisions of the Labor Code relating to employee retaliation claims – Section 98.7, which enables workers to file retaliation claims with the Labor Commissioner, and Section 1102.5, which prohibits (a) employer policies seeking to prevent an employee from disclosing information to a government or law enforcement agency about potential violation of state or federal law, and (b) retaliation against an employee who discloses such information, refuses to participate in activity that would result in a legal violation, or who has exercised such rights in a former job.
Prior to AB 1947, Labor Code Section 98.7 required an employee who believed s/he had been discharged or otherwise discriminated against in violation of any law enforced by the Labor Commissioner to file their claim for retaliation with the Labor Commissioner within six months of the retaliatory act. But AB 1947 extends the deadline for filing with the Labor Commissioner to one year after the allegedly retaliatory act. While at first blush this may seem to be a relatively insignificant change, it could increase the number of Labor Commissioner proceedings initiated by employees. Employees now have significantly more time to gather information, speak with potential witnesses, and seek counsel before pursuing administrative relief. Also, employees could still bring a subsequent civil lawsuit – so, employers could be forced to defend themselves against claims in both an administrative and a court proceeding.
AB 1947 also implemented a significant amendment to Labor Code Section 1102.5, radically increasing the potential liability that employers face for retaliation claims brought under this provision. Previously, employees who prevailed in lawsuits alleging violation of Labor Code Section 1102.5’s retaliation protections could obtain damages – but, the statute did not allow a prevailing plaintiff the right to recover attorneys’ fees. All of that has changed. Now, as amended by AB 1947, Labor Code Section 1102.5 expressly grants courts the authority to award reasonable attorneys’ fees to a worker who prevails on his or her Section 1102.5 “whistleblower” retaliation claim. Adding this one-way fee-shifting provision only in favor of employees will likely make whistleblower claims more attractive to plaintiffs’ lawyers, and will no doubt be used as a tool to leverage settlement. Further, this amendment incentivizes litigation over informal dispute resolution (or even seeking administrative remedies).
Read the full text of AB 1947 here.