Judicial Council of California Issues Opinion in David Zamora Vs. Security Industry Specialists Case

SACRAMENTO, California, Oct. 30 (TNSsro) -- The Judicial Council of California issued the following opinion (No. H044008):

DAVID ZAMORA, Plaintiff and Appellant, v. SECURITY INDUSTRY SPECIALISTS, INC., Defendant and Respondent.

David Zamora sued his former employer, Security Industry Specialists, Inc. (SIS), under the California Fair Employment and Housing Act (FEHA) (Gov. Code, Sec. 12900 et seq.)/1 for employment discrimination based on physical disability, failure to make a reasonable accommodation, failure to engage in the interactive process, retaliation, wrongful termination, and other claims after SIS laid him off while he was recovering from an industrial injury. The trial court granted summary adjudication of all but two causes of action. The parties later stipulated to dismiss the remaining claims, and the court entered judgment for SIS.

In this appeal, Zamora challenges the trial court's summary adjudication of his disability discrimination, retaliation, wrongful termination in violation of FEHA, and wrongful termination in violation of public policy claims. Our de novo review of the record demonstrates that summary adjudication was improperly granted with respect to Zamora's disability discrimination and wrongful termination claims, but that summary adjudication in favor of SIS was appropriate with respect to Zamora's retaliation claim. We will therefore reverse the judgment and remand the matter for further proceedings in the trial court.

I. FACTS

At all relevant times, SIS provided security staffing services to major corporations, including Apple Computer, Inc. (Apple) and other technology companies. SIS hired Zamora as a "standard deployment field supervisor" assigned to Apple's main campus in Cupertino, California. He started on May 26, 2010. His duties included supervising mobile officers and security specialists on his shift, responding to security calls and client requests, conducting shift briefing meetings, evaluating and administering discipline to subordinates, driving, and providing "security for top-level employees." Zamora testified that the physical requirements of the job included walking four to six hours per day, standing seven hours a day, climbing (including onto the roof), stooping, bending, kneeling, and lifting up to 50 pounds.

SIS employed 19 supervisors at Zamora's worksite. The supervisors reported to watch commanders, and according to Zamora, there were three watch commanders, one for each shift. The watch commanders in turn reported to the site manager, Marty Vaughn.

On June 2, 2010--eight days after he was hired--while running to answer a medical call with four coworkers, Zamora tripped over a curb, twisted his left knee, heard a loud popping noise, and "immediately experienced severe pain in his left knee." Zamora claims his supervisor, Watch Commander Jim Mazon, witnessed the incident. Zamora told Mazon he was having pain in his left knee, and Mazon suggested he ice the knee and elevate it when he got home. Mazon did not report the injury to SIS as required by company policy or instruct Zamora to report the injury.

Zamora iced and elevated his left knee as Mazon suggested and used a knee brace. Despite having "very intense knee pain," Zamora continued to work every day from June 2, 2010, until November 17, 2010. Zamora testified that during this time, he mentioned his knee pain numerous times to both his coworkers and his superiors.

After Zamora completed a probationary period, he became eligible for health insurance benefits from SIS. Zamora waited until he had health insurance to seek medical treatment for his knee injury. On October 14, 2010, he saw Dr. Douglas Blatz, an orthopedic surgeon. He told Dr. Blatz the injury was work-related and, according to Zamora, that started the workers' compensation claim process. Dr. Blatz diagnosed a torn meniscus and medial shelf plica and told Zamora he needed arthroscopic surgery on his left knee.

After seeing Dr. Blatz, Zamora formally reported the injury to SIS. On October 15, 2010, he gave site manager Vaughn a written report from Dr. Blatz. Vaughn instructed Zamora to fill out an SIS incident report and a Workers' Compensation Claim Form (Dept. of Industrial Relations form DWC-1) and asked watch commander Robert Freeman to help Zamora with the forms. SIS terminated Mazon a few days later for multiple reasons, including his failure to report Zamora's injury.

Zamora claims that on more than one occasion between mid-October and mid-November 2010, he asked Mazon or Vaughn for work that involved less standing and physical activity, consistent with his work restrictions. Zamora was having severe left knee pain and thought that performing such work would decrease his pain and allow him to continue working. He alleges that both Mazon and Vaughn told him there was no other work for him to do and that SIS's failure to provide modified work in 2010 aggravated his knee injury.

On October 29, 2010, Zamora was seen by Dr. Mojan Manzar-Nejad at Alliance Occupational Medicine (Alliance). The record suggests he was referred there by SIS. Zamora gave a history of the knee injury in June 2010. He told Dr. Manzar-Nejad that although he was able to perform his regular job, he could no longer control his pain with ibuprofen and asked for Vicodin. He also told the doctor that he injured the same knee in 2007, with injuries to his meniscus and anterior cruciate ligament resulting in arthroscopic surgery, and that he had been "fine" ever since. Dr. Manzar-Nejad noted positive findings in the left knee on examination and that Dr. Blatz had obtained an MRI that was positive for "full-thickness cartilage defect" and revealed the prior injury and surgery. Dr. Manzar-Nejad diagnosed internal derangement of the left knee with abnormal findings on the MRI. He opined that an orthopedic consultation was necessary to determine whether Zamora's complaints were due to a new injury or his old injury and whether they were industrial. Dr. Manzar-Nejad prescribed a soft knee splint, cold packs, and pain medication; released Zamora to return to full duty; referred him to clinic orthopedist Dr. Samir Sharma; and told Zamora to return in three weeks or sooner if his condition worsened.

On November 17, 2010, Zamora stopped working because he could not tolerate the pain any longer. That day, he saw Dr. Anthony Dubose at Alliance, complained of pain, and reported that overall, his condition was worse. Dr. Dubose took him off work; arranged for him to be seen by Dr. Sharma the following day; and reported that Zamora could return to work the following day on modified duties: "Mostly Seated Work," "Elevate Affected Extremity," "Sit/Stand As Needed," and no lifting, pulling, or pushing over five pounds. Dr. Dubose estimated that Zamora would need modified work for two months.

The record does not contain a medical report of Zamora's consultation with Dr. Sharma on November 18, 2010. Thus, we do not know whether the orthopedist agreed with or changed Dr. Dubose's work restrictions. According to Zamora, Dr. Sharma gave him a cortisone injection and recommended six weeks of physical therapy. Zamora thought his condition was more serious, requested a second opinion, and was referred to an orthopedic surgeon, Dr. Ashay Kale.

Zamora saw Dr. Kale on December 2, 2010. Dr. Kale noted that Zamora had significant pain and swelling in the knee and confirmed that he needed surgery. Zamora told Dr. Kale he could not perform his regular work duties, so the doctor recommended that he get authorization for surgery--presumably from the workers' compensation insurer--and that he remain off work until the surgery was done.

Given the delay in formally reporting the claim, and the report of a prior injury to the same knee, SIS's workers' compensation carrier, California Insurance Company--through its claims administrator Applied Underwriters (hereafter jointly Insurer)--questioned whether the injury occurred at work and initiated an investigation. As part of its investigation, Insurer arranged for Zamora to be seen by a "qualified medical evaluator,"/2 Dr. Edwin Kingsley, who presumably opined on the question of industrial causation. (Dr. Kingsley's report is not in the record.)

Insurer withheld payment of temporary disability benefits while it investigated the claim. From mid-November 2010 until mid-March 2011--while Insurer investigated the claim--SIS continued to pay Zamora his full salary. According to SIS, this was not its customary practice, but it made an exception in Zamora's case. Insurer accepted the claim in February or March 2011. On March 17, 2011, Insurer issued its first temporary disability payment to Zamora covering the period March 1 through March 17, 2011. After that, Insurer made biweekly temporary disability payments to Zamora through November 8, 2012.

On March 25, 2011, SIS sent Zamora a check for $2,166.67 covering his salary for the period March 1 through March 15, 2011, the same period for which Insurer had already paid temporary disability. SIS initially asserted that the duplicate payment (hereafter overpayment) was due to a misrepresentation by Zamora to Insurer regarding the last day he was paid by SIS. But after investigating the matter, SIS determined that Zamora did not misrepresent the date he was last paid by SIS and that the overpayment was due to an error by SIS's human resources manager, Michelle Ortiz, who failed to notify payroll to stop the salary continuance payments.

Thomas Seltz was SIS's co-president, chief financial officer, and general counsel. In April 2011, Seltz learned that Zamora had applied for a job at one of SIS's new client sites. Seltz thought it was wrong for Zamora to be doubly compensated for his temporary disability. He told Vaughn about the overpayment and said that before SIS would offer Zamora a job at the new site, he would have to return the money. Seltz believed that was the right thing for a supervisor like Zamora to do. He told Vaughn that Zamora would be "disrespecting" the company if he did not pay the money back and asked Vaughn to call Zamora and request reimbursement. Vaughn called Zamora and asked him to return the money that SIS had overpaid./3

According to Vaughn, Zamora said he had gone through months of pain, was struggling financially, and could not afford to reimburse the company. Vaughn told Seltz that Zamora was thinking about reimbursing the company. Zamora disputed these facts. He declared that "Vaughn did not mention that there was a double payment" and claimed that no one at SIS ever asked him to return the money. Zamora never reimbursed SIS for the overpayment.

While on disability, Zamora kept Vaughn and SIS human resources apprised of his disability status and updated them every time he went to a doctor. Zamora recalled speaking with Vaughn three times between December 2010 and May 2011. Although his doctor had not released him to return to work yet, on each of those occasions, Vaughn reassured him that there would be a job for him as soon as he was released to return to work. At one point, Vaughn told him he would be getting another position that would be "scaled down" and "more of an inside . . . sitting down type of position."

Dr. Kale performed arthroscopic surgery on Zamora's left knee on May 18, 2011, and saw him in follow-up on May 31, 2011. SIS considered Zamora's return to work at that time. On June 1, 2011, Vaughn stated in an e-mail to Dave Harville, the vice president of operations at SIS, that if Zamora returned to work, he would have to try and find a position for him and that he did not know if he had a "Supervisor position available." Vaughn also asked: "If we termed him, would he still have to pay back the amount?"

On June 24, 2011, Insurer sent Dr. Kale a letter asking whether Zamora might be able to return to modified duties and asked him to fill out a form setting forth Zamora's work restrictions. Dr. Kale responded on June 29, 2011, and reported that, based on his May 31 exam, Zamora could return to modified work and do the following tasks: keyboarding, operating cash, supervising others that perform physical tasks, driving, and sitting for up to eight hours. He could stand for two hours at a time, walk for one hour, but could not do any climbing.

After receiving Dr. Kale's report, SIS human resources manager Ortiz and Vaughn proposed a "temporary, modified work" position for Zamora as an administrative supervisor, which appears to have been consistent with Dr. Kale's restrictions, at the same salary as before. They also proposed training him for the position. Since it was not clear whether Zamora knew that Dr. Kale had released him to modified work, Ortiz suggested sending Zamora a letter and asked for management input on the contents of the letter. In an e-mail dated July 13, 2011, Harville said that the letter should advise Zamora that his return to work "is contingent upon repayment" of the overpayment and suggested that SIS should "be prepared to separate him if he chooses not to accept the return to work [sic] agreement." Ortiz responded that the company could not terminate him for rejecting modified work "because he is still on workers' compensation." She did not think SIS "should terminate him until workers' compensation clears him from his claim" and recommended SIS reevaluate the terms of his employment after the claim is closed.

On July 14, 2011, Ortiz prepared a draft letter to Zamora, which described the modified work offer, including the duties of the position. The draft letter stated that "in order to reinstate" his employment, Zamora would have to pay back the overpayment and suggested he could pay the money back over time with "deductions" from his paycheck. Ortiz sent the draft letter to Jeff Venturini, a senior human resources manager, and asked for his input. On July 21, 2011, Ortiz sent Venturini an e-mail stating, "I know I have been asking you every day now but did you get to that David Zamora letter?" The record does not contain a response to Ortiz's e-mail or explain what happened with the proposal to offer Zamora modified work as an administrative supervisor.

When Zamora saw Dr. Kale on July 27, 2011, he complained of stiffness and popping in the knee. Since it had been only two months since the surgery, and Zamora was not able to fully flex or straighten the knee, Dr. Kale thought more time off to recover and exercise would be beneficial. He was also concerned that Zamora might aggravate his pain and hinder his recovery by going back to work too early. Dr. Kale therefore authorized him to remain off work another six weeks--until September 11, 2011--at which time the doctor hoped to release him to modified duty.

In August or September 2011, Apple told SIS that it planned to cut its budget for SIS's services by $7 million in 2012. This affected all of SIS's Apple worksites and prompted a reduction in force of approximately 10 percent. SIS eventually laid off 48 employees nationwide, including 14 employees at the site where Zamora worked. The reduction in force affected four of the 19 supervisory positions at that site. After SIS determined that it would have to lay off four supervisors, Vaughn worked with human resources and senior management to develop merit-based criteria to evaluate the supervisors to determine who would be laid off. Vaugh and four watch commanders later evaluated the supervisors on a scale of zero to five in seven categories: customer service, performance, critical thinking, communication, initiative, tenure, and availability. Zamora ranked 16th of the 19 supervisors, and since he was among the four lowest-rated supervisors, his position was selected for the lay-off. According to Vaughn, the evaluators understood that they could not consider Zamora's disability or workers' compensation claim and gave him a "high score" of four for availability. Zamora received a low score for communication because he occasionally tried to handle security matters on his own when he should have involved his superiors. After the reduction in force, the supervisors who remained at the site absorbed Zamora's duties.

Dr. Kale saw Zamora on September 12, 2011, and released him to return to modified work beginning October 3, 2011, with the following restrictions: no kneeling, bending, or squatting, and no night shift work.

In September 2011, Seltz learned that Zamora had been selected for the lay-off and told SIS recruiter Ted Bianchi, whose duties included recruiting new employees and recommending existing employees for open positions, that Zamora could be "rehired" as long as he reimbursed the company for the overpayment. Zamora alleged Seltz also told Bianchi that Zamora was "disrespecting the company" by failing to return the overpayment. Although SIS management continued to complain about the overpayment until Zamora was laid off, there is no evidence SIS ever sent Zamora an accounting or a written demand to reimburse the overpayment or tried to work out a repayment plan with him.

On September 29, 2011, SIS sent Zamora a letter advising him of the reduction in force and that he would be laid off on October 10, 2011. The letter stated that "this decision was not prompted by" or "in any way related to" his performance and that he would therefore be eligible for unemployment benefits. The letter said SIS would be working hard to identify new clients and suggested Zamora "periodically check in" with one of its recruiters.

Zamora saw Dr. Kale on September 30, 2011, and complained of increased pain in his left knee after a fall. Dr. Kale concluded that he was not able to return to work as planned, rescinded the previous release to modified work, and extended his temporary disability for two weeks.

After SIS eliminated the four supervisory positions as part of the reduction in force, it found other positions for two of the supervisors (Murillo and Lopez) who had ranked lower than Zamora in its evaluation process. Rather than lay them off, SIS retained them, but demoted them to patrol officers. Thus, only two of the four lowest-ranked supervisors (Zamora and one other) were laid off in the reduction in force, along with 12 other employees at the Cupertino site.

Although SIS notified Zamora on September 29, 2011, that he had been selected for the lay-off, there is some evidence that it continued to look for another position for him after that date. On September 30, 2011, Seltz sent an e-mail to SIS recruiter Bianchi stating: "Assuming he is cleared to be rehired somewhere, the below is the amount he needs to pay back." On October 1, 2011, Harville sent an e-mail to Vaughn and others stating that SIS needed a driver for eBay, "someone that can drive[] the CFO around for the rest of the year." Someone forwarded the e-mail to Bianchi, who suggested Zamora and one other employee. He said Zamora "would be great," the job "might be a good fit," and he "could have both ready to interview on [M]onday." The record does not reveal what happened with the driver position at eBay.

On October 13, 2011, SIS sent Zamora a letter stating that management had been trying to contact him by phone to discuss his employment status for two days and had left three messages to which Zamora had not responded. The letter stated that "[d]ue to [his] lack of attendance and no correspondence," SIS was "sending this notification to inform" him that "due to the restructuring of the security program, [SIS had] been forced to cut certain positions" and that his position had been "impacted by these cuts." The letter stated that he still possessed "SIS/Apple uniforms or property," asked him to return the uniforms, and said that if he failed "to return all uniforms" or "pay this amount immediately," SIS would assign the debt to its attorneys or a collection agency, which would "adversely affect [his] credit record and may impact [his] ability to borrow or obtain employment." The letter did not mention the overpayment, specify an amount owed, or explain what "this amount" meant.

Seltz and Vaughn declared that SIS did not hire any new employees to replace those that were laid off in October 2011 and that there were further reductions in SIS's force after that date as Apple moved more of its security work in-house. Zamora testified that after the lay-off, SIS continued to post ads for security officer, supervisor, and watch commander positions. He produced copies of two SIS ads: (1) for a watch commander posted on November 18, 2011, and (2) for a supervisor posted on April 25, 2012.

Zamora's doctors had not released him to return to full work duties any time prior to October 10, 2011, the date he was laid off. Dr. Kale testified that when he last saw Zamora in February 2012, he was not able to return to work in any capacity. Dr. Kale had given him injections to lubricate the knee, but they did not give him much relief, so Dr. Kale referred him to a joint specialist. Zamora had a second surgery on his left knee in June 2012. The nature of that surgery and the name of the surgeon are not identified in the record. Since Insurer paid temporary disability benefits through November 8, 2012, we may infer that Zamora's condition became permanent and stationary as of that date.

Zamora claimed Seltz's allegedly defamatory statements made it hard for him to find work in private security after he was laid off. After the lay-off, Zamora took "small detail jobs," but did not obtain employment comparable to his job at SIS. Zamora's discovery responses listed employment with three security companies between October 2011 and November 2014.

In February 2013, Zamora settled his workers' compensation claim with SIS and Insurer. The settlement included any claim for partial permanent disability and a release of any discrimination claim based on Labor Code section 132a, which prohibits discrimination against an employee who files a workers' compensation claim. Upon approving the settlement, the workers' compensation judge ordered that the petition that Zamora had filed with the Workers' Compensation Appeals Board (WCAB) based on violations of Labor Code section 132a be dismissed.

Zamora testified that SIS's failure to accommodate his disability between June 2010 and November 2010 aggravated his knee injury. He believed it was against the law to terminate an employee who is temporarily disabled by an industrial injury and that he was laid off in retaliation for filing a workers' compensation claim. Zamora filed a complaint with the Department of Fair Employment and Housing (DFEH) and received a right-to-sue letter on October 5, 2012.

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Footnotes:

1/ Undesignated statutory references are to the Government Code.

2/ A "qualified medical evaluator" is a licensed physician who has been appointed by the administrative director of the Division of Workers' Compensation of the California Department of Industrial Relations to evaluate medical-legal issues arising under the workers' compensation laws, including disputes regarding industrial causation and the compensability of any injury. (Cal. Code Regs., tit. 8, Sec. 1, subd. (z); Lab. Code, Sec.Sec. 139.2, 4060, 4062.1.)

3/ SIS never asked Zamora to return the $15,166.69 it had paid as salary continuance prior to March 1, 2011. It sought reimbursement of only the $2,166.67 it paid after Insurer started paying temporary disability.

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View full opinion at https://www.courts.ca.gov/opinions/documents/H044008.PDF