Panel Seeks OK to Make Job Bias Awards

In a case that could have wide effect in the workplace, the California Supreme Court was asked Tuesday to give a state commission power to make unlimited punitive damage awards to victims of job bias.

An attorney for the state Fair Employment and Housing Commission told the justices that the threat of financial penalty is necessary to effectively deter discrimination by employers.

“Denial of such authority would mean that in many cases the commission would not have any way of dealing with the most egregious cases of discrimination,” Deputy Atty. Gen. Marian M. Johnston said.

Procedural Safeguards

But a lawyer for a Southern California company charged with job bias argued that punitive damages could not legally be imposed by the commission in the absence of express legislative authority to do so.

“Such power should not be casually assumed,” said Michael Wischkaemper, representing Dyna-Med Inc. of Carlsbad in northern San Diego County.

Wischkaemper contended that it would be unfair to subject defendants to such penalties because the commission lacks the strict procedural safeguards found in the courts, including trial by jury. Members of the commission, appointees of the governor, are not required to be attorneys and make decisions based on transcripts of previous hearings rather than hearing testimony from witnesses personally, he noted.

The justices heard an hourlong argument in a case that has drawn widespread attention from both employers and job-rights groups.

At present, the commission has specific authority to impose punitive damage awards of up to $1,000 for violations of laws against bias in housing--but only recently has it attempted to order punitive damages for job discrimination.

Victims of job bias already are able to win punitive damages by going to court, a more costly and time-consuming process than pursuing a claim through the commission.

Merchants Group

In a “friend of the court” brief filed earlier in the case, the 2,800-member Merchants and Manufacturers Assn. argued that the commission’s assertion of authority to award punitive damages in job cases could have a “truly staggering impact,” opening the way for others among the scores of administrative agencies operating in California to assert similar power over a wide range of businesses and professions they regulate.

But lawyers for civil rights groups, backing the commission, argued that the alternatives of job reinstatement, the award of back pay and other more limited remedies that the commission can order for victims of job discrimination provide little deterrent to employer misconduct. The case before the court was brought in a complaint filed in 1978 before the state Fair Employment and Housing Department by Linda Olander of San Diego, a Dyna-Med employee who claimed that she had been denied a promotion because of sex discrimination.

According to testimony in the case, a settlement was reached with Dyna-Med in which the employer promised to keep Olander on the job and train her for promotional opportunities. But within hours after the parties and the department signed the settlement, the woman was fired.

Finally, in 1982, the commission awarded Olander punitive damages of $7,500 for what it called Dyna-Med’s “deliberate, egregious (and) inexcusable” retaliation against her for filing a complaint. The company brought suit against the commission, saying it had exceeded its authority.