HomeMy WebLinkAboutMINUTES - 05101994 - 1.17 TO: BOARD OF SUPERVISORS Contra
FROM: Phil Batchelor, County Administrator Costa
County
DATE: May 3, 1994
SUBJECT: LEGISLATION: SB 1682 (Johnston)
SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION
RECOMMENDATION: .
ADOPT a position in OPPOSITION to SB 1682 by Senator Patrick
Johnston, which would make an employer_ who engages in fraudulent
conduct in terminating or attempting to terminate an employee
liable for all consequential and reasonably foreseeable damages
resulting from that conduct.
BACKGROUND:
Recent court decisions have held that the employment relationship
is fundamentally contractual,. that with limited exceptions contract
damages are the appropriate remedy for wrongful termination, and
that no independent fraud claim for tort recovery arises from a
misrepresentation aimed at termination of employment.
Senator Johnson has introduced SB 1682, which would change this
employment relationship and make an employer who engages in
fraudulent conduct in terminating or attempting to terminate an
employee liable for all consequential: and reasonably foreseeable
damages resulting from that conduct.
While we think we understand what the author is trying to
accomplish and while we certainly do not approve of employers
engaging in , .fraudulent conduct in terminating or attempting to
terminate an employee, we are also - concerned about the potential
exposure to lawsuits to which this legislation would subject the
County. In addition to the additional exposure to. damages, the
bill would subject the County to the cost of additional lawsuits in
which the County would have to defend itself against unfounded
charges of fraud.
CONTINUED ON ATTACHMENT: YES SIGNATURE:
RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
APPROVE OTHER
SIGNATURE(S):
ACTION OF BOARD ON May 19,1994 APPROVED AS RECOMMENDED OTHER
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A TRUE
—ZUNANIMOUS(ABSENT. ) AND CORRECT COPY OF AN ACTION TAKEN
AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD
ABSENT: ABSTAIN`. OF SUPERVISORS ON THE DATE SHOWN.
ATTESTED v
Contact: PHIL BATCHELOR CLERK OF THE BOARD OF
cc: See Page 2 SUPERVISORS AND COUNTY ADMINISTRATOR
J .
BY s LA 4 IKX.�L�-Q.�' DEPUTY
-2-
The County Counsel ' s Office recommends that the Board of
Supervisors consider opposing SB 1682 . This office agrees that the
Board of Supervisors should oppose SB 1682 .
cc : County Administrator
County Counsel
Acting Personnel Director
Risk Management
Les Spahnn, Heim, Noack & Spahnn
OFFICE OF THE COUNTY COUNSEL
CONTRA COSTA COUNTY
Date: March 18, 1994
To: Phil Batchelor, County Administrator
Attn: C. L.Van Marter
From: Victor J.Westman, County Counsel
By:A. W.Walenta Jr.,Asst. Co. Counsel
Re: Senate Bill 1682 (Johnston)
Senate Bill 1682 would make employer liable for actual and punitive damages for
fraudulent conduct in connection with the termination of an employee. Because the bill would
enlarge the County's exposure to damages due to fraudulent conduct, it could subject the County
to additional expenses both in damages and the cost of defending unfounded charges of fraud.
Therefore, you may want to recommend to the Board of Supervisors that it oppose SB
1682 or determine if CSAC will be in opposition.
CONTRA COSTA COUNITY
RECEIVED
MAR 1 81994
OFFICE OF
COUNTY ADMINISTRATOR
SENATE BILL No. 1682
Introduced by Senator Johnston
February 23, 1994
An act to add Section 2929.5 to the Labor Code, relating to
employment.
LEGISLATIVE COUNSEL'S DIGEST
SB 1682, as introduced, Johnston. Employment:
termination.
Existing law provides that an employment, having no
specified term, may be terminated by the will of either party
on notice to the other. Recent court decisions have held that
.the employment relationship is fundamentally contractual,
that with limited exceptions contract damages are the
appropriate remedy for wrongful termination, and that no
independent fraud claim for tort recovery arises from a
misrepresentation aimed at termination of employment.
This bill would provide that an employer who engages in
fraudulent conduct in terminating or attempting to terminate
an employee shall be liable for all consequential and
reasonably foreseeable damages resulting from that conduct;
including, but not limited to, loss of past and future wages,
damages for emotional distress, and attorney's fees. The bill
would also provide that an employer who violates its
provisions may be liable for exemplary damages.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
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SB 1682 — 2 —
The
2 —
The people of the State of California do enact as follows.-
1
ollows.1 SECTION 1. Section 2929.5 is added to the Labor
2 Code, to read:
3 2929.5. (a) An employer who engages in fraudulent
4 conduct in terminating or attempting to terminate an
5 employee shall be liable for all consequential and f
6 reasonably foreseeable damages resulting from that
7 conduct, including, but not limited to, loss of past and
8 future wages as defined in Section 200, damages for
9 emotional distress, and attorney's fees.
10 (b) For purposes of this section, "fraudulent conduct"
11 means an intentional misrepresentation, deceit, or
12 concealment of a material fact known to the employer
13 and related to the termination or attempted termination.
14 (c) An employer who violates the provisions of this
15 section may also be liable for exemplary damages
16 pursuant to Article 3 (commencing with Section 3294) of
17 Chapter 1 of Title 2 of Part 1 of Division 4 of the Civil
18 Code.
O
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