Employee Discrimination Claims Now Have Three-Year Deadline

Before filing a lawsuit concerning employment-related claims of discrimination or harassment (such as sexual harassment), an aggrieved employee first must make a filing with the California Department of Fair Employment and Housing (“DFEH”). The DFEH is the administrative body tasked with overseeing employment discrimination under the California Fair Employment and Housing Act (“FEHA”). The FEHA is the main anti-discrimination statute here in the Golden State. If an employee does not file with the DFEH within the stated deadline, the employee is barred from asserting a claim after the deadline and cannot file a lawsuit in state or federal court. In other words, if the deadline passes, generally speaking, no case can be filed.

Until recently, the deadline for filing a claim with the DFEH was one year. Governor Newsom, however, just signed Assembly Bill 9 (“AB 9”) which extends that deadline to three years. AB 9 is generally known as the Stop Harassment and Reporting Extension (“SHARE”) Act and was authored by Assemblywoman Eloise Reyes (D-Grand Terrace). See news report here. The SHARE Act was touted as an anti-sexual harassment bill, but the actual language of AB 9 is not limited to sexual harassment claims. All employment-related claims of bias, discrimination, harassment, and retaliation now carry the longer deadline. The SHARE Act becomes effective on January 1, 2020. It is unclear if the revised statute of limitations will be retroactive. However, most statutes are given retroactive effect by California courts and San Diego employers should assume that AB 9’s effect is retroactive.

Assemblywoman Reyes and other proponents of the SHARE Act argued that the longer time deadline was needed because most people are unaware of the one-year deadline and that the longer deadline is the standard under other types of lawsuits. Further, as the Committee comments note, it takes “… courage, and support for victims of sexual harassment and sexual violence to feel comfortable making public allegations against the perpetrator of their abuse.” Extending the statute of limitations will give victims time to process their trauma, to fully grasp what has happened, and to prepare for the process of confronting their perpetrator. Furthermore, since many victims fear retaliation if they come forward, the extra time allows for victims to find new employment before beginning the process of filing a complaint with the DFEH.

AB 9’s enactment will mandate various changes for employers including:

  • Changes in record keeping since a claim of harassment or discrimination must now be kept open for at least three years — this includes keeping track of potential witnesses who may separate from the company and retention of electronic communications
  • Other efforts to avoid the staleness of evidence such contemporaneous recording/video recording statements during any internal investigation
  • Potential adjustments to insurance coverage
  • Possible increased insurance premiums
  • Review of and potential adjustments to contractual language for severance contracts, releases, and employment contracts
  • With respect to potential mergers and acquisitions, due diligence of management behavior and harassment/discrimination risk assessments must now delve back three years; revised contract language might be needed

Call San Diego Corporate Law Today

For more information, call corporate attorney Michael Leonard, Esq., of San Diego Corporate Law.  Mr. Leonard has been named as “Best of the Bar” by the San Diego Business Journal for the last four years. Mr. Leonard has extensive experience in drafting employee policies, employee handbooks, employment contracts, and all other contracts and agreements necessary for running your business. Mr. Leonard can be reached at (858) 483-9200 or via email. Like us on Facebook.

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