Ultimate California Wrongful Termination Guide 2021

Updated: Mar 4

Everything you need to know about wrongful termination claims in California and how to find the best employment lawyers.


An employee can bring an wrongful termination claim (also known as a "Tameny" claim after the decision of the California Supreme Court in Tameny v. Atlantic Richfield Co.) where the discharge "violates basic labor laws" embodied in local and federal laws.


In the case of Tameny, for instance, the employee was fired for refusing to engage in an illicit scheme to set fuel retention rates.


An employee does not have a wrongful termination claim just because the termination was unjust or not fair. There are specific labor laws that determine if you have a legitimate wrongful termination claim against your employer. You can request an unbiased referral to a pre-screened wrongful termination lawyer for a FREE case analysis 24 hours a day if you believe your employer violated your employee rights.



What exactly is considered wrongful termination in California?


Wrongful termination is a type of retribution that their employers may inflict on workers. Under both federal and state wage and hour regulations, this is an actionable crime. Section 15(a)(3) of the Equal Labor Standards Act (FLSA) expressly forbids the firing of an employee by an employer if a complaint has been filed. This complaint can be submitted in writing or orally, usually to the Department of Labor's Wage and Hour Division (WHD) (the DOL).


The state law that forbids this is Section 98.6 LC of the California Labor Code. An employee filing a complaint about a labor law violation (most commonly unpaid wages) is covered, similar to Section 15(a)(3) of the FLSA. Section 98.6 LC is often referred to as the "whistleblower statute" since it protects whistleblowers under California wage and hour laws.


Employees in California have the right to sue their employer in federal court if the employee has been wrongfully fired. This can be achieved under the Labor Code at the federal level, under the FLSA, or at the state level.

In addition, if this termination was inflicted as a reprisal on the employee for filing an unpaid wage complaint, then the termination itself is the basis for a labor lawsuit.


This takes place independently of the case of unpaid salaries. Even if the court ultimately denies the employee's allegations of unpaid wages, the fact that they were unfairly dismissed constitutes an actionable offense which could result in the employee being owed financial compensation.


This also limits the reasons why an employee can legally fire an employee, despite the fact that California is an at-will employment state. If the employer in question has "discriminatory intent" to fire the employee, one of the most common legal grounds for an unfair termination claim and/or litigation arises. This suggests that for the dismissal, they had certain unlawful motives.

Under Section 98.6 of the California Labor Code, it is unconstitutional to fire an employee in retaliation for alleging unpaid salaries, reporting any breach of wages and hours, or filing a backpay claim lawsuit. Any worker who performs any of these acts is known as a "whistleblower" and is protected by California law.

Other forms of retribution are also prohibited by this particular labor law, including the dismissal of the worker, the reduction of their scheduled working hours, and/or the relocation of them to a smaller agency. Any of these acts would be called retaliation, which would be grounds for a complaint about retaliation.

In addition, employers in the state of California are not legally authorized to fire an employee under both federal and state labor laws for any of the following reasons:

  • Ethnicity

  • Country of origin

  • Religion beliefs

  • Skin color

  • Mental and/or psychological handicap

  • Health status and/or physical impairment (protected under FEHA and ADA)

  • Data on genetics

  • Age

  • Identity between gender, sex, and/or gender

  • Matrimonial status

  • Sexual preference

  • Language or for having an accent

  • Military service and/or rank as a veteran

  • Political affiliation

  • Jury duty

  • Family Medical Leave

  • Pregnancy or maternity leave

  • Whistleblowing Retribution

These different factors are not assumed to be valid, legal, and/or legitimate grounds for termination. In the most important anti-discrimination labor law, "The Fair Employment and Housing Act," they are largely specifically delineated (also known as FEHA). This is a California state statute that refers to employers with five (5) or more employees.

In order to protect disadvantaged groups of workers from unfair termination and/or abuse, FEHA was effectively established. This ensures that, for all of these reasons, an employer can not threaten an employee either.


Based on any of these considerations, the employer in question is therefore not legally permitted to encourage what is recognized as a "hostile work environment" through harassing. This implies that there is an implied expectation under California labor laws that employers create a working atmosphere that has a certain minimum degree of safety and security for their workers.


Specific examples of wrongful termination in California

While most workers are "at-will" employees, there are grounds for dismissing an employee that would breach California or federal legislation. An employee, for example, may not be dismissed from his or her job for the following reasons:

  • Exercising a constitutionally covered right, such as making a petition for workers' compensation, taking parental leave, using sick days, or taking meals or rest breaks.

  • In retaliation for reporting a crime in the workplace that the employee felt violated local, state, or federal law.

  • Doing a compulsory obligation, such as being on jury duty or in the military.

  • Whistleblowing or refusing to engage in criminal activity.

  • Discrimination on the basis of the protected status of an employee, such as race, sex, religion, age, disability, sexual orientation, or even political affiliation.

For wrongful termination in California, what kind of lawyer is needed?


Employment attorneys may represent employees who are wrongfully terminated. An employment lawyer will determine the facts of your case and advise you on the dangers and possible advantages of making a wrongful termination lawsuit.


Is wrongful termination in California difficult to prove?


The burden of making a case through a preponderance of the facts are on an employee bringing a wrongful termination case. The evidence is circumstantial in most cases. To win a wrongful termination lawsuit, an employee doesn't need "smoking gun" evidence.

By pointing to the changing reasons for a dismissal, contradictions in the employer's story, and the time it took to report the wrongful termination action, an employee can win a wrongful termination lawsuit.

How long does it take for a wrongful termination lawsuit in California?


How long a wrongful termination lawsuit lasts depends on several variables, many of which are not within the employee's influence. Almost all lawsuits are settled before trial, according to court statistics.


In fact, some cases are resolved before they are even brought to court.


Most times, within a few months after it is filed in court, the parties are willing to resolve the claim. Absent arbitration, it can take many years for a lawsuit to come to trial.


How much does a case of wrongful termination in California cost?


In California, the billing rate for wrongful termination lawyers will vary. In wrongful termination proceedings, however, most wrongful termination attorneys are able to work out certain alternative fee plans. If the case is strong, by treating the case on a contingency fee basis, an attorney might be willing to take on significant risk and costs.


In that case, if the employee wins, the employee just pays the lawyer's fee (a portion of the recovery). Other times, in exchange for a lower percentage of the recovery, the lawyer can agree to accept a reduced hourly charge. There are fee agreements subject to negotiation.


Could you contest a case of wrongful termination in California?


In general, to terminate an employee, an employer does not need a good reason or "cause." Indeed, to terminate an employee, an employer does not need any excuse at all. Workers in the United States, unlike employees in other countries, have no job protection without a formal contract or a union bargaining arrangement.


The employee must be able to prove that the termination violated a basic public policy or workplace safety law in order to contest a job termination. You will be helped by an employment lawyer to decide if your dismissal was unconstitutional or simply unreasonable.


How long do you need to file a lawsuit for wrongful termination?


It depends on the statute that has been broken and how long you have to file suit. An employee, for example, has three years to file workplace discrimination or retaliation lawsuit with the California Department of Equal Jobs and Housing (the agency that administers the California Fair Employment and Housing Act). A common law lawsuit for wrongful termination, on the other hand, is regulated by a two-year statute of limitation.


In California, can you be terminated for no reason?


Yes, in California, non-union workers may be terminated for no reason at all. An employer can terminate an employee because it is Friday, or because the employee has failed to satisfy the receptionist or for being rude.


However, an employer cannot terminate an employee for illegal reasons such as discrimination in the workplace. Check our wrongful termination section for more information.


What does Constructive Termination mean?


An employer can make working conditions so miserable that an employee has no choice but to leave. There could be an argument for constructive dismissal or discharge if this occurs.


If you think an employee would consider resigning in similar circumstances, contact a wrongful termination attorney in Los Angeles to decide if you have a legitimate argument. In addition, under California law, wrongful termination and constructive discharge awards are the same.


"Under California law, what is an "Employee"?


Only an "employee" is legally eligible to file a lawsuit and/or claim unfair termination under California labor law. This is because wrongful termination is a breach of the employment contract, legally speaking.


Therefore, under California labor law, we must identify precisely what an employee is. A worker is called an employee if they operate under the direction, supervision, and/or control of an employer. This is known to be distinctly different from what "independent contractors" are called.


These independent contractors offer a product and/or service to a corporation or employer, but they do so with a considerable degree of flexibility about how they work. In other words, an independent contractor is someone who works for the business but decides the particulars of how the product and/or service is provided. They are not under the company's direct control. The higher the degree of control the employer has, the more likely an "employee" and not an "independent contractor" is the individual in question.


It is hypothetically conceivable that if they somehow breached the implied or explicit terms of their employment agreement, an independent contractor would have a claim against a company. Still, this breach would not be unfair termination in the true sense of the word. Wrongful termination in California only happens when a legally recognized employee of that organization is the aggrieved party.


Exception for Public Policy


These at-will work regulations have several exceptions. The first is the exception to public policy, which is caused if the employee in question declined to violate a statute or rule, refused to commit perjury, and/or refused to conspire with the employer to discriminate against a prospective employee because of their ethnicity, race, religion, age, sexual orientation, and/or gender. If any of these caveats are breached, then, under the public policy exception to at-will jobs, it is grounds for a wrongful termination claim.


This public policy exemption also occurs when a worker's compensation lawsuit has been made by the aggrieved employee. Section 132(a) of the Labor Code in California specifically forbids an employer from firing an employee for filing a worker's compensation claim and/or discriminating against him. The employee in question could be entitled to financial compensation for back pay as well as damages for emotional distress and the reinstatement of their jobs if the court rules that this breach happened.


This public policy exemption also applies to whistleblowers from businesses. However, this extension extends only when the employee in question raises valid concerns regarding health and safety, violations of state or federal laws, any form of criminal behavior, and/or business practices that are deemed unethical. This may involve breaches of anti-trust, price gouging, and other unscrupulous acts on the employer's part.


This public policy exception has been accepted by the vast majority of states, including California.


The implied exception to contract


Defining the employment contract's exact terms is one of the key obstacles in constructing a wrongful termination case. Essentially, in order for wrongful termination to have happened legally, there would also have been a breach of said contract. This is complicated because both formal employment agreements (written contracts) and implied employment agreements are accepted by the state of California (verbal agreements).


An "implied employment contract" is characterized by California labor law as an arrangement not in writing between the employee and their employer. Alternatively, this contract is established by the actions of both parties. This is legally binding and requires verbally made promises.


This implied arrangement implies, in the sense of California labor laws, that the employer does not fire the employee without any compelling or justifiable reason.


An implied contract of employment is an exception to California's at-will employment, and the breach of that implied contract would be grounds for a wrongful termination claim.


If the employer in question made clear claims about the security of the job that the employee accepted, this implicit contract could occur. The employer claimed in this case that if he or she did anything or fulfilled some caveat, the employee in question would have a permanent role at the company. An implicit contract would, in the absence of a formal document, be considered legally binding.


A considerably more common form of an implied contract is typically found in the employee handbook beyond this verbal guarantee of any position or title. If the employer in question tells their workers that their rights and obligations are found in the business's written handbook, then the employer has entered into an implicit arrangement that they will not fire the employee as long as they comply with those expectations and meet those responsibilities.


The employer is immediately exposed to civil responsibility by passing out employee manuals and needs a justifiable excuse to fire an employee. Without any clearly specified transgression, this implied contract results in an implied, legal obligation not to terminate jobs. The handbook, in other words, essentially acts as the implicit employment contract.


The civil courts are subject to the considerable interpretation of these implicit contracts. The court must analyze all the case's underlying circumstances in question to decide whether an implicit employment arrangement exists in a given case. This implies that in these situations, maintaining a competent attorney is important.


Most states, including California, have accepted this exemption from implied contracts.


Covenant of Exception of Good Faith


Another explanation for a wrongful termination case is a "covenant of good faith" when the termination of jobs happens. A covenant means "agreement" in legal terms. Even though it goes a little further, this covenant of good faith is very close to the implied contract exception.


This good faith relationship occurs between the employer and the employee when the employee in question duly performs the work duties. If the employer terminates the work, then the good faith exception agreement has been broken.


"Good faith" in legal terms means that, in a particular situation, an individual or entity acts without malicious intent and recognizes the best interests of the other party concerned. This termination is therefore deemed to be a breach of the caveat of good faith.


Consider a worker who has worked for a corporation for several years and is scheduled to retire with full benefits. The organization then terminates him or her a few weeks before this employee's retirement. The business did not have a lawful excuse but simply did so to stop paying these maximum benefits. This is a good example of a breach of the covenant of good faith.


There are only a few states which, in good faith doctrine, have embraced the covenant. California is, luckily, one of them.


Written Exception to Work contract


This exception is the exact opposite of the doctrine of the implied contract. When the employment arrangement between the employer and the employee is clear, it is enabled. This means that the document in question is written and is a legally binding contract.


Usually, this written contract exemption extends to business leaders and/or upper management. If based on a written employment contract, the employer provides a term of employment to a hired employee, both the employee and the employer must comply with that contract's terms. If any of these conditions are breached by the employee in question, then the employer has every right to terminate this term of employment.


If, on the other hand, in breach of either of these provisions of the employment contract, the employer terminates the employee. The employee in question will have a clear and powerful case of California wrongful termination.


This exception to the written contract is valid in all 50 states.


California Wrongful termination and wages


State law requires employers at the time of termination to pay workers all salaries owed. Cal., Cal. Code of Labor § 201. This covers the salaries of the employee before the date of termination and also the accumulated and unused holiday or paid off time of the employee (PTO). Cal., Cal. Code of Labor § 227.3.


For commission workers, all earned commissions determined at the time of termination must also be compensated by employers. Cal., Cal. Code of Labor § 201. This does not refer to sick leave that is unpaid.


If an employer intentionally fails to pay all salaries, including accrued vacation and received commissions, to a terminated employee, the employee can collect fines for waiting time. Waiting time penalties accrue to a sum equal to the normal rate of pay of the employee compounded by the number of days not paid by the employee, up to 30 days. Cal., Cal. Code of Labor § 203.


How do I prove Wrongful termination in California?


An employer who, for an improper cause, terminates an employee is unlikely to be upfront about it. To escape future liability, some employers also use probationary periods for new hires.


Employees who claim they have been unlawfully dismissed must identify facts demonstrating that the employer's justification for the firing was both unlawful and a "substantial motivating factor." Proof may include remarks that indicate a bias by the boss or manager involved. Some proof gathering tips include:

  • Written proof documents, including emails, text messages, or slack messages

  • Obtaining necessary documents, such as pay stubs, performance reviews, or notes for analysis

  • Collecting data from prospective witnesses who might have witnessed any criminal activities

By demonstrating that the employer handled them differently than another employee who behaved in the same manner, an employee may also prove misconduct.


Example of wrongful termination in California: An employer terminates a Hispanic worker for violating a workplace rule, but under the same circumstances did not fire non-Hispanic employees who violated the same rule.

This may support the argument by the employee that the wrongful termination took place for racial reasons. Consultation with an experienced wrongful termination lawyer can assist workers in deciding if they have the evidence to prosecute a termination claim effectively.

What is the Statute of Limitations for Wrongful Termination in California?


The period of time after an incident that a person has to file a lawsuit is a statute of limitations. Because the statute of limitations can differ depending on the type of lawsuit you want to file, if you think you have been the victim of wrongful termination in California, you should consult with an experienced employment attorney as soon as possible.


In California, wrongful termination cases are usually brought under the Equal Jobs and Housing Act ('FEHA') for workplace discrimination, harassment, and retaliation. The FEHA protects workers against discrimination based on "race, religious belief, mental disability, marital status, sex, gender, medical condition, genetic information, gender identity, skin color, national origin, ancestry, physical disability, sexual orientation, gender expression, age, or military and veteran status." Moreover, the FEHA specifies employers' responsibilities to accommodate disabled workers and accommodate religious beliefs/observances.


California legislation also offers accommodation and leave rights under the Pregnancy Disability Leave Act ("PDLL") for pregnant workers. The California Family Rights Act ('CFRA') provides for job-protected leave for employees of larger firms who meet eligibility criteria and need time off for their serious medical condition, to take care of a parent, infant, or spouse's serious medical condition, or to bond with a new baby. The ("NPLA") New Parent Leave Act provides for workers who meet eligibility criteria for job-protected leave so that they can bond with a new baby/child.


An employee claiming claims under the FEHA, CFRA, PDLL, and/or NPLA must first file a complaint with the State Agency responsible for administering California's civil rights statutes, the Department of Equal Jobs and Housing ('DFEH'). A complaint had to be lodged with the DFEH within one year of the suspected illegal practice before the passage of AB 9.


Notice that under the judicially created "continuing violation doctrine," any actions pre-dating that time could occur, but the doctrine applies only under very restricted circumstances. In other words, it may use where an employee can prove that the unlawful conduct of the employer that occurred during the limitation period was "similar or related to the behavior that happened earlier," "reasonably frequent," and had not yet "become permanent." In other words, the period continued with the discriminatory and/or harassing behavior "occurring outside the limitation period." During the fatigue era, an employee is often best advised to file their complaint with the DFEH.


An employee in California can do one of two things when filing with the DFEH:

  1. file an online complaint requesting an automatic letter of 'right-to-sue' so that they can file a lawsuit against the company/employer in civil court, or

  2. submit an online intake form to request that the DFEH conducts its own investigation into the suspected misconduct of the employer. (Most employees represented by a wrongful termination lawyer prefer the first option; employees without a wrongful termination lawyer often choose the second option.)

For employees who choose to have the DFEH investigate, the agency has up to one year to conclude their investigation from the date the DFEH complaint was lodged. The DFEH may close the file and issue a right-to-sue letter along the way, or, if it makes a finding of merit, may prosecute the action on the employee's behalf. Employees then have one year to file a complaint in federal court from the date of issue of the "right-to-sue" letter.


Depending on the particular form of wrongful termination claim brought, there are other statutes of limitations. For instance, in situations where the employee is terminated due to discrimination or whistleblower retaliation charges are sometimes brought in combination with a tort claim for wrongful termination in public policy breach. As stated in section 335.1 of the Code of Civil Procedure, the statute of limitation for a California wrongful termination lawsuits is two years from the termination date.


Furthermore, as section 337 of the Code of Civil Procedure applies, the statute of limitations for violating a contractual argument is four years. However, according to section 339, the statute of limitations for violating an oral or implied contract is two years.


However, lawsuits for damages brought under the Labor Code Private Attorneys General Act of 2004 ('PAGA') must be made within one year. They must be exhausted with the Labor and Workforce Development Agency. The statute of limitations for breaches under the Labor Code is three years.


California Wrongful Termination Settlements.


An employee can claim damages in Wrongful termination cases for:

  • Lost salaries, history, future

  • Any more advantages

  • Termination-induced fear, mental distress, or depression

  • If an employer in California is found to be guilty of fraud or malice, punitive damages

  • Fees and fees to lawyers

As a result of a California wrongful termination case, there are different damages that you will be entitled to obtain. The employer in question can decide to give you a settlement before it even goes to trial, depending on the case's facts. Whether or not you approve this settlement depends on how much you intend to collect in damages and how solid the proof is that you have really been dismissed wrongfully.


Since wrongful termination in California is a form of unpaid compensation case, back pay will be included in the damages in question. This backpay consists of any missed earnings that were discontinued due to the unfair firing and employee benefits. Note that incentives are treated as a kind of compensation and used in an unpaid wage lawsuit.


It is possible to objectively compute and check this backpay. It is sometimes referred to as 'liquidated damages' as such. However, you may also be entitled to financial compensation for pain, deprivation, and/or mental distress. The measurement of these damages is not as simple as unpaid salaries and will depend on your legal team's abilities and expertise.


If the wrongful termination claim is decided in your favor, then the court will also require that your former employer compensate you for your solicitor's expenses and court costs. Finally, the court can also impose on your former employer "punitive damages." They are not meant to reward you but instead serve as a correction and/or penalty to ensure that said illegal activity is not repeated by the employer in question.


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