ANDREACCHI v. PRICE COMPANY (1997)

Plaintiff Deborah Andreacchi appeals from a judgment dismissing her wrongful termination action against her former employer, The Price Company, after the sustaining of a demurrer without leave to amend.   We conclude that her complaint was barred by the exclusivity provisions of workers' compensation law and that those provisions have not been repealed or superseded by recent amendments to the Fair Employment and Housing Act.

FACTUAL AND PROCEDURAL BACKGROUND

Because this appeal arises after the sustaining of a demurrer, we must assume the truth of all properly pleaded material allegations of fact.  (Lazar v. Superior Court (1996) 12 Cal.4th 631, 635, 49 Cal.Rptr.2d 377, 909 P.2d 981.)   However, we do not assume the truth of contentions, deductions, or conclusions of fact or law, such as allegations that a party's actions were unlawful.   (Moore v. Regents of University of California (1990) 51 Cal.3d 120, 125, 271 Cal.Rptr. 146, 793 P.2d 479.)

Plaintiff was an employee of defendant, The Price Company, from mid-1989 until her discharge in February 1994.   After being discharged, plaintiff sued defendant and Injury Control Systems, Inc. (ICS), doing business as Pacific Occupational Health Clinic Medical Associates (Clinic).   Her third amended complaint included the following allegations.   ICS, doing business as the Clinic, was the treating physician for all work-related injuries suffered by defendant's employees and was also “aligned” with Hertz Claims Management, defendant's workers' compensation carrier.   Plaintiff was injured on the job as the result of a fall in January 1994.   When she reported the injury, defendant referred her only to the Clinic and not to any alternative medical care provider.   Plaintiff had never been permitted to select from two providers or select her own physician to treat her for a work-related injury.

At the Clinic, plaintiff was diagnosed as having a contusion and low back strain and was told not to return to work.   Nevertheless, defendant's workers' compensation agent advised plaintiff by letter that she had been determined to be fit for work and that her compensation benefits were being terminated.   Defendant denied her request to see her own physician.   Plaintiff returned to the Clinic, was diagnosed as suffering from a cervical/lumbar strain, and was advised that she was being released to work on a modified program with limitations.   However, the release was made without any analysis of her job requirements.   Because plaintiff did not agree with the release, she sought an examination at a hospital emergency room.   The diagnosis was recurrent lumbar strain;  the recommendation, bed rest and further treatment at the Clinic.

Plaintiff returned to the Clinic and again was advised she was unable to return to work.   However, the following day, the Clinic issued an amended report stating that she could return to regular work on the next day, February 9. When plaintiff learned of the amended report, she saw a chiropractor, who diagnosed her as suffering from radiculitis concurrent with lumbar injury and placed her on one month additional disability.   Despite receiving this disability information, defendant discharged plaintiff on February 25 for not returning to work.   Defendant did not speak to plaintiff about her right to a medical leave, although it was aware she was entitled to such leave.

Based on this sequence of events, the third amended complaint alleged causes of action against defendant for intentional and negligent infliction of emotional distress.   Plaintiff alleged that as a result of defendant's conduct, she sustained great mental suffering and emotional distress, “with the result that she was rendered generally ill and suffered emotional injury, greatly affecting her general mental and emotional health.” ¹

Defendant demurred on the grounds that the causes of action were barred by the exclusivity provisions of workers' compensation law, that the complaint failed to state a cause of action upon which relief could be granted, and that it failed to the extent it was based on a conspiracy claim.   The trial court sustained the demurrer and dismissed the action against defendant with prejudice.

DISCUSSION

 Although plaintiff alleged only intentional and negligent infliction of emotional distress against defendant, she now contends that her complaint was sufficient to state a statutory cause of action for employment discrimination under the California Fair Employment and Housing Act (FEHA) ( Gov.Code, § 12900 et seq.) or a tort cause of action for wrongful discharge in violation of public policy.

When ruling on a demurrer, the trial court must look past the form of a pleading to its substance.   It must ignore confusing or erroneous labels attached to causes of action by an inept pleader and instead determine whether the complaint, liberally construed, alleges facts sufficient to constitute a cause of action under any legal theory.  (Saunders v. Cariss (1990) 224 Cal.App.3d 905, 908, 274 Cal.Rptr. 186.)   But a court does not abuse its discretion in sustaining a demurrer without leave to amend if the complaint, liberally construed, does not state a cause of action and there is no reasonable possibility under applicable law that an amendment could cure its defects.  (Heckendorn v. City of San Marino (1986) 42 Cal.3d 481, 486, 229 Cal.Rptr. 324, 723 P.2d 64.)

Labor Code section 3600, subdivision (a) provides in pertinent part that subject to certain exceptions and conditions, workers' compensation liability, “in lieu of any other liability whatsoever” will exist “against an employer for any injury sustained by his or her employees arising out of and in the course of the employment․” ² The basis of this exclusivity rule is the presumed compensation bargain, in which the employer assumes liability without regard to fault in exchange for limitations on the amount of liability.   The employee is provided relatively swift and certain payment of benefits for an injury without having to prove fault but, in return, gives up potential tort damages.  (Fermino v. Fedco, Inc. (1994) 7 Cal.4th 701, 708, 30 Cal.Rptr.2d 18, 872 P.2d 559.)   It is well-settled that an employee who suffers disabling emotional distress from employer conduct that is a normal part of the employment relationship, such as a discharge, may not avoid the exclusivity rule simply by characterizing the conduct as unfair, outrageous or intended to cause that distress.³  (Id. at p. 712, 30 Cal.Rptr.2d 18, 872 P.2d 559;  Gantt v. Sentry Insurance (1992) 1 Cal.4th 1083, 1099, 4 Cal.Rptr.2d 874, 824 P.2d 680;  Shoemaker v. Myers (1990) 52 Cal.3d 1, 7, 18-20, 276 Cal.Rptr. 303, 801 P.2d 1054.)

 One aspect of the exclusivity rule is based on section 132a, which prohibits discrimination against workers injured in the course and scope of their employment and provides compensation and other remedies to an aggrieved worker for such discrimination.   Jurisdiction to award increased compensation under this section is with the workers' compensation appeals board.  (See generally, Judson Steel Corp. v. Workers' Comp. Appeals Bd. (1978) 22 Cal.3d 658, 664-669, 150 Cal.Rptr. 250, 586 P.2d 564.)   Based on section 132a, appellate courts have held consistently that workers' compensation law provides the exclusive remedy for work-related disability discrimination.  (See, e.g., Denney v. Universal City Studios, Inc. (1992) 10 Cal.App.4th 1226, 1235, 13 Cal.Rptr.2d 170;  Pickrel v. General Telephone Co. (1988) 205 Cal.App.3d 1058, 1063-1064, 252 Cal.Rptr. 878.)

 However, the exclusivity rule does not preclude a tort action for wrongful discharge in contravention of a fundamental public policy grounded in either a constitutional or statutory provision, because that employer misconduct cannot be considered a normal part of employment relationship or a normal risk encompassed within the compensation bargain.  (Gantt v. Sentry Insurance, supra, 1 Cal.4th at pp. 1095, 1100-1101, 4 Cal.Rptr.2d 874, 824 P.2d 680;  Tameny v. Atlantic Richfield Co. (1980) 27 Cal.3d 167, 172-178, 164 Cal.Rptr. 839, 610 P.2d 1330.)   The Supreme Court also has recognized that there may be statutory exceptions, express or implied, to the exclusivity rule.   Illustrative is former Government Code section 19683, a “whistleblower” protection statute, which authorized a civil action for damages incurred from official retaliatory acts.   In Shoemaker v. Myers, supra, 52 Cal.3d 1, 276 Cal.Rptr. 303, 801 P.2d 1054, after contrasting the purposes served by the workers' compensation scheme and the whistleblower statute, the court concluded that the Legislature intended the latter to afford an additional remedy to an aggrieved employee, thereby creating a specific exception to workers' compensation law.  (Id. at pp. 7, 20-23, 276 Cal.Rptr. 303, 801 P.2d 1054;  see 2 Hanna, Cal. Law of Employee Injuries and Workers' Compensation (2d ed. rev.1996) § 21.03[2][d], p. 21-26.)

This court and other Courts of Appeal have rejected recent attempts to extend the high court's rationale in Shoemaker to permit a civil action under the FEHA by an employee allegedly subjected to employment discrimination as a result of a work-related injury.  (Usher v. American Airlines, Inc. (1993) 20 Cal.App.4th 1520, 1524-1527, 25 Cal.Rptr.2d 335 [Dossee, J., Strankman, P.J., Newsom, J.];  Angell v. Peterson Tractor, Inc. (1994) 21 Cal.App.4th 981, 994-997, 26 Cal.Rptr.2d 541;  Langridge v. Oakland Unified School Dist. (1994) 25 Cal.App.4th 664, 667-670, 31 Cal.Rptr.2d 34;  Adkins v. State of California (1996) 50 Cal.App.4th 1802, 1817-1822, 59 Cal.Rptr.2d 59, petn. for review pending.)   In Usher, we emphasized Government Code section 12993, subdivision (a), which at the time stated that the FEHA was not “deemed to repeal any of the provisions of the Civil Rights Law or any other law of this state relating to discrimination․”  We reasoned that the Legislature presumably was aware of the exclusivity provisions of workers' compensation, including section 132a, when it enacted the FEHA, yet expressly disclaimed any intent to repeal that preexisting exclusive remedy for a particular type of discrimination.  (Usher, supra, at pp. 1525-1526, 25 Cal.Rptr.2d 335.)

We noted in Usher that the FEHA was amended in 1992 to bring it into conformity with the federal Americans with Disabilities Act and that neither party argued that the amendments had any potential applicability to the appeal.  (Usher v. American Airlines, Inc., supra, 20 Cal.App.4th at p. 1525, fn. 7, 25 Cal.Rptr.2d 335.) But the effect of those amendments was considered in Jimeno v. Mobil Oil Corp. (9th Cir.1995) 66 F.3d 1514, in which the court rejected the argument that the exclusivity rule had been eliminated.   The court relied on the principle that the Legislature's rejection of a specific provision contained in an act as originally introduced is strong evidence that the act should not be construed to include the omitted provision.   As introduced, the assembly bill containing the 1992 amendments included a proposed new Government Code section 12994, which would have eliminated workers' compensation exclusivity as to discrimination in employment because of physical disability, mental disability, or medical conditions.   However, that proposed section was never enacted.   The Jimeno court interpreted the Legislature's decision not to enact that provision as indicative that the amendments were not intended to have any effect on workers' compensation exclusivity.  (Jimeno, supra, at pp. 1529-1530.)

In 1993, the FEHA was again amended, and plaintiff insists that amendment does demonstrate legislative intent to eliminate the exclusivity rule of section 132a.   As we have noted, Government Code section 12993, subdivision (a), previously read in pertinent part:  “Nothing contained in this part shall be deemed to repeal ․ any other law of this state relating to discrimination․”  Effective January 1, 1994, that section was amended to include the following phrase:  “ ․ unless those provisions provide less protection to the enumerated classes of persons covered under this part.”   (Stats.1993, ch. 1277, § 15.)   According to plaintiff, the language of the amendment is unambiguous and needs no interpretation;  it eliminates the exclusivity rule for work-related disability discrimination, because workers' compensation law provides less protection to aggrieved workers than the FEHA.

The argument is not new.   Two divisions of the Court of Appeal, Second District, have reached opposite conclusions about the effect of this amendment, and the issue currently is pending before the Supreme Court.  (Cammack v. GTE California Inc. (1996) 48 Cal.App.4th 207, 55 Cal.Rptr.2d 837, review granted Nov. 26, 1996 (S057121) [amendment did not impliedly repeal preemptive effect of workers' compensation law];  City of Moorpark v. Superior Court (1996) 49 Cal.App.4th 973, 57 Cal.Rptr.2d 156, review granted Nov. 26, 1996 (S057121) [workers' compensation law no longer bars FEHA action for discrimination because of work-related physical disability].) ⁴

Because the controversy has been squarely presented and thoroughly analyzed in these pending cases, we consider it unnecessary to reiterate the arguments and counter-arguments at length.   At the same time, plaintiff's insistence that the amendment is unambiguous merits some response.   We acknowledge the general principle that when statutory language is clear and unambiguous, there is no need for statutory construction or resort to some other indicia of legislative intent, such as legislative history.  (Delaney v. Superior Court (1990) 50 Cal.3d 785, 798, 268 Cal.Rptr. 753, 789 P.2d 934.)   However, whether the words of a statute are clear is itself not always clear.   (2A Sutherland, Statutory Construction (5th ed.1992 rev.) § 46.04, p. 98.)   When a statute that appears unambiguous is shown to have a latent ambiguity, a court may turn to legislative history or other aids for guidance.  (Stanton v. Panish (1980) 28 Cal.3d 107, 115, 167 Cal.Rptr. 584, 615 P.2d 1372.)   Although particular statutory language may seem clear when considered in isolation, an ambiguity or uncertainty requiring interpretation or construction may exist when that language is considered in context.  (See Stockton Sav. & Loan Bank v. Massanet (1941) 18 Cal.2d 200, 207, 114 P.2d 592.)

The amendment upon which plaintiff pins her argument was part of Assembly Bill 2244, which also amended several other sections of the Government Code, added new sections to that code, and amended the Civil Code as well.   Nowhere in that bill is there a mention of employment discrimination, workers' compensation law, or section 132a.   Instead, the bill generally concerns discriminatory practices in housing.   For example, it amended certain sections of the Civil Code regulating the purchase of mobile homes.   (Stats.1993, ch. 1277, §§ 1, 2.) It amended Government Code section 12995 to provide that discriminatory land use regulations, zoning laws, and restrictive covenants are unlawful.  (Stats.1993, ch. 1277, § 4.) It amended several Government Code sections and added others to clarify or modify procedures for preventing and eliminating housing discrimination.  (Id. at §§ 9-14.)   It included one uncodified section expressing legislative intent as to the applicability of the act to the secondary mortgage market and another containing legislative findings and declarations regarding certain unlawful housing practices.  (Id. at §§ 17-18.)   Plaintiff's argument that the amendment to Government Code section 12993 is unambiguous completely ignores the entire package of legislation of which it was one small part.   When the amendment is considered in that context, its intended scope is certainly debatable.

If the meaning of a statute is unclear, a court may turn to legislative history for insight into legislative intent.  (People v. Hazelton (1996) 14 Cal.4th 101, 105, 58 Cal.Rptr.2d 443, 926 P.2d 423.)   Reports of legislative committees are part of legislative history and provide some indication of how a measure was understood at the time by those who voted for its enactment.   (Hutnick v. United States Fidelity & Guaranty Co. (1988) 47 Cal.3d 456, 465, fn. 7, 253 Cal.Rptr. 236, 763 P.2d 1326.) The legislative committee reports on Assembly Bill 2244 are directed exclusively at explaining the effect of the bill on the state's housing discrimination laws.   The reports neither state nor imply that passage of the bill will have any effect on laws aimed at employment discrimination or on workers' compensation, indeed, they do not even mention employment discrimination, workers' compensation, or section 132a.   (See, e.g., Sen. Floor Com., 3rd reading Analysis of Assem. Bill No. 2244 (1993-1994 Reg. Sess.), hrg. Sept. 1, 1993;  Sen. Com. on Judiciary, Analysis of Assem. Bill No. 2244 (1993-1994 Reg. Sess.), as amended Aug. 23, 1993, hrg. Aug. 24, 1993;  Analysis of Assem. Bill No. 2244 (1993-1994 Reg. Sess.), as amended May 5, 1993, hrg. June 2, 1993;  Assem. Com. on Judiciary, Analysis of Assem. Bill No. 2244 (1993-1994 Reg. Sess.), as introduced March 5, 1993, hrg. April 28, 1993.)

The Supreme Court has emphasized repeatedly that repeals by implication are not favored and are recognized only when there is no rational basis for harmonizing two potentially conflicting laws.   A court should not presume that the Legislature, with its enactment of a statute, intended to overthrow long-established principles of law unless that intention clearly appears either by express declaration or necessary implication.  (See, e.g., Manufacturers Life Ins. Co. v. Superior Court (1995) 10 Cal.4th 257, 267, 276-277, 41 Cal.Rptr.2d 220, 895 P.2d 56;  Fuentes v. Workers' Comp. Appeals Bd. (1976) 16 Cal.3d 1, 7, 128 Cal.Rptr. 673, 547 P.2d 449.) The presumption against implied repeals is so strong that when a new enactment conflicts with an existing provision, the new law will not be construed to repeal or supersede the existing law unless it constitutes a revision of the entire subject, so that a court may say that it was intended to be a substitute for the existing law.  (Roberts v. City of Palmdale (1993) 5 Cal.4th 363, 379, 20 Cal.Rptr.2d 330, 853 P.2d 496.)   We see absolutely no evidence that the Legislature meant to effect any change in workers' compensation law, let alone one so substantial, when it enacted Assembly Bill 2244.   In our view, whatever the Legislature did intend to accomplish by amending Government Code section 12993, subdivision (a), as part of that bill, it did not intend to repeal by implication the well-established exclusive remedy under section 132a for employment discrimination based on work-related injury.

 To summarize, we conclude that plaintiff cannot amend her complaint to state a cause of action under the FEHA because of the exclusive remedy provisions of workers' compensation law.⁵  For the same reason, she cannot amend to plead a common law tort action for wrongful termination in violation of public policy, based on her claim of discrimination.  (Angell v. Peterson Tractor, Inc., supra, 21 Cal.App.4th at pp. 996-997, 26 Cal.Rptr.2d 541.)   As Division Five of this court explained in Langridge v. Oakland Unified School Dist., supra, 25 Cal.App.4th 664, 31 Cal.Rptr.2d 34, employer conduct in violation of public policy is outside the compensation bargain, and it can be argued plausibly that physical disability discrimination violates public policy.   Nevertheless, despite that apparent public policy, the Legislature has, through section 132a, placed work-related disability discrimination within the scope of the compensation bargain, making workers' compensation the exclusive remedy.  (Langridge, supra, at pp. 669, fn. 1, 670, 31 Cal.Rptr.2d 34.)

 Plaintiff also contends that her complaint is sufficient to state a tort cause of action for wrongful termination because she alleged that defendant violated sections 4600.3 and 4601, which pertain to an employee's choice of health care providers and similar matters.   That conduct, she reasons, justifies an action for wrongful discharge in violation of public policy.   However, section 5304 provides that with an exception not relevant here, “The appeals board has jurisdiction over any controversy relating to or arising out of Sections 4600 to 4605 inclusive․”  Plaintiff's exclusive remedy for any alleged violation of these statutes was through workers' compensation.  (See, e.g., Ralphs Grocery Co. v. Workers' Comp. Appeals Bd. (1995) 38 Cal.App.4th 820, 826-830, 45 Cal.Rptr.2d 197 [controversy over employee's choice of physicians and right to request change of physicians pursuant to sections 4600 and 4601].)

The trial court properly sustained defendant's demurrer and dismissed plaintiff's complaint, based on the exclusive remedy provisions of workers' compensation law.

DISPOSITION

The judgment is affirmed.

FOOTNOTES

1.   Plaintiff also alleged medical malpractice, intentional and negligent interference with contract, and defamation against ICS. Those allegations are not at issue in this appeal.

2.   All subsequent statutory references are to the Labor Code unless otherwise indicated.

3.   Instead, injuries caused by ordinary employer conduct that intentionally, recklessly, or knowingly harms an employee may entitle that employee to extra compensation under section 4533.  (Fermino v. Fedco, Inc., supra, 7 Cal.4th at p. 713, 30 Cal.Rptr.2d 18, 872 P.2d 559.)

4.   Before Cammack or City of Moorpark were decided, a federal district court concluded that the FEHA amendment repealed the exclusivity rule.   The court based its decision on the “plain language” of the amendment.  (Gallo v. Board of Regents of University of California (S.D.Cal.1995) 916 F.Supp. 1005, 1008-1009.)   Only a few days before review was granted in Cammack and City of Moorpark, another federal district court came to the same conclusion (Buckley v. Gallo Sales Co. (N.D.Cal.1996) 949 F.Supp. 737, 744-748).

5.   Even if plaintiff were correct about the effect of the amendment, her complaint is not sufficient to state a statutory cause of action for discrimination under the FEHA. Exhaustion of FEHA administrative remedies is a prerequisite to a civil action on a statutory cause of action under that act.  (Rojo v. Kliger (1990) 52 Cal.3d 65, 83, 276 Cal.Rptr. 130, 801 P.2d 373;  Martin v. Lockheed Missiles & Space Co. (1994) 29 Cal.App.4th 1718, 1724-1725, 35 Cal.Rptr.2d 181.)   Here plaintiff did not allege the filing of an administrative complaint with the California Department of Fair Employment and Housing or the issuance of a right to sue letter (see Gov.Code, § 12965, subd. (a)), and she does not claim that she can amend to remedy that omission.

STRANKMAN, Presiding Justice.

STEIN and DOSSEE, JJ., concur.