Gino DiCaro

Expanded employer liability bill shelved

By Gino DiCaro, VP, Communications

Capitol Update, Sept. 14, 2007 Share this on FacebookTweet thisEmail this to a friend



AB 437 (Dave Jones, D-Sacramento) to effectively eliminate the statute of limitation for lawsuits under the Fair Employment and Housing Act (FEHA) and the labor code did not make it over its last hurdle to reach the Governor.

If enacted, AB 437 would have allowed the statute of limitations for any type of employment discrimination lawsuit to run as long as an employee's pay or benefits was still "affected" by the alleged discriminatory decision. The term "affected" would have applied each time an employee was paid following the employer's decision. This change in law would have been unprecedented as no California statute or case law permits a catch-all rule based on the repeated issuance of paychecks. Basically, AB 437 would have allowed pay, compensation, or benefits to become the threshold for keeping the statute of limitations running.

During the final week of the legislative year, CMTA, CalChamber, the California Grocer's Association, the California Banker's Association and the California State Association of Counties met with representatives from the Governor's Office of Planning and Research, the State Consumer Services Agency, the Department of Fair Employment, Housing and Labor. Each state entity is responsible for providing an analysis and recommendation on the issue to the Governor, providing a great opportunity to urge their opposition to the bill and strengthening grounds for a veto.

In the final days of the regular legislative year and before the pending Assembly Concurrence vote, AB 437 was officially declared a "2-year" bill - a great victory for all those that opposed the measure. The bill currently sits on the Assembly Floor and will not be acted upon until 2008.

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