Small Employers Win Victory in Age Bias Case : Lawsuits: The state Supreme Court says an anti-discrimination law does not apply to businesses with fewer than five workers.

Small businesses in California cannot be sued for age discrimination under current law, the California Supreme Court held unanimously Monday.

The court, reviewing an Orange County case, said the only state law that prohibits such discrimination, the Fair Employment and Housing Act, exempts employers with fewer than five workers.

“We conclude that there presently exists no ‘fundamental policy’ which precludes age discrimination by a small employer,” Justice Marvin Baxter wrote.

The decision means that an estimated 552,800 small employers in the state cannot be held legally liable for discriminating against workers because of their age.

The state Supreme Court ruling overturned a decision by the 4th District Court of Appeal in Santa Ana, which held last year that a worker who suffers age discrimination could sue the employer. The act also bans discrimination on the basis of gender, race, religion or sexual orientation.

The California Supreme Court ruling is “the first decision we have seen in a long, long time out of any court that has actually recognized the right to discriminate,” said Orange attorney Bruce W. Hamby, who represented the defendant in the case.

Janet Jennings brought the case after losing her job of four years as a receptionist and clerical worker for James Marralle, a Newport Beach endodontist, a dentist specializing in root canals.

Jennings, who was in her early 50s, said Marralle told her in 1990 that he wanted to replace her with someone younger because her advancing age was requiring him to pay too much toward the office pension plan.

Marralle denied the allegation, contending that Jennings quit “in a huff” after her request for a raise was refused. Jennings, now in her late 50s, works for a dentist in Palm Desert.

“I was fired because of my age, and it’s too bad employers are able to do that,” she said Monday. “The law as it stands now is not fair to me or anyone in my situation. It’s been difficult to try to prove a point and have it go this way.”

Marralle said he was pleased with the decision, calling his former worker’s claim “frivolous from the start.” The case, he said, has been “vastly expensive” for him.

Hamby and other lawyers said small employers probably would still be liable for discriminating on the basis of race, gender or religion because those categories are protected by the state Constitution. But suits charging discrimination on the basis of sexual orientation--which like age is not protected by the state Constitution--probably would not be allowed, they added.

The Legislature exempted small businesses from the anti-discrimination statute after they argued that even a single suit without merit could bankrupt a small firm. Nonprofit religious organizations also are exempt.

Marvin D. Mayer, another Orange attorney who represented Jennings, called the court’s decision outrageous.

“I think the Legislature should do something about it,” Mayer said.

Other lawyers noted that workers can still sue small employers for age and other kinds of discrimination if the employers actually harass their workers.

“The law requires all employers, no matter how big or how small, to keep from harassing their employees on the basis of age,” said Joseph Posner, a member of the board of the California Employment Lawyers Assn.