Fashion 21 v. Coalition for Humane Immigrant Rights of Los Angeles

In Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074 (Schifando), the California Supreme Court determined that a city employee who claimed to have suffered employment-related discrimination was not required to exhaust both the internal administrative remedy in the city charter and the administrative remedy provided by the California Fair Employment and Housing Act (FEHA; Gov. Code, § 12900 et seq.), before filing an FEHA disability discrimination claim in superior court. In this case, we must resolve a question identified in Schifando, but not addressed, that is, whether a public employee who claims employment-related discrimination, and asserts both FEHA claims and non-statutory claims for wrongful demotion and constructive termination in violation of public policy must exhaust the internal administrative remedy provided by his or her employer with respect to those non-statutory claims before filing a civil action. We conclude that Schifandos exemption must also apply to FEHA-related non-statutory claims when the resolution of those claims would have a preclusive impact on the FEHA claim. To require exhaustion of internal administrative remedies for those FEHA-related non-statutory claims would unduly burden a public employee. A public employee would first have to successfully challenge the administrative findings in an administrative mandamus action, which might detrimentally impact the employees right to bring a FEHA claim, and his or her right under Schifando, to choose the appropriate forum to pursue that claim. In light of Schifando, and based on the conclusion we reach here, the trial court erred in dismissing plaintiff Michael D. Williamss (Williams) complaint alleging retaliation (§ 12940, subd. (h)) for failure to exhaust his internal administrative remedy, but did not err in dismissing Williamss non-statutory claims because those claims are not FEHA-related. Thus, as alleged, the resolution of Williamss non-statutory claims will have no preclusive effect on his FEHA claim against his former employer, the defendant and respondent Housing Authority of the City of Los Angeles (HACLA). Accordingly, Williamss claims for wrongful demotion and constructive termination in violation of public policy are barred for failure to exhaust his internal administrative remedy. Therefore, we affirm in part, and reverse in part.