There was insufficient evidence to support a $300,000 jury award to a terminated restaurant server who sued her former employer, claiming whistleblower retaliation, a California appeals court recently ruled. The uncontested evidence established that the employee’s supervisor did not know about her complaints about missed meal breaks when deciding to fire her, and therefore could not have retaliated against her, the court concluded, reversing the award.
The employee was generally well regarded by her peers and the general manager, but in 2015 and 2016 received six corrective action memorandums from her managers and was suspended once.
On March 6, 2017, a new general manager took over. In late March 2017, a shift manager notified the general manager that she suspected the employee of circumventing the restaurant’s policy for sharing tips among the staff, and of manipulating a customer loyalty program to take advantage of unused benefits. The manager initiated an investigation.
In early April, the employee “water-bombed” a trainee server, as follows:
The restaurant’s servers used a computer system to keep track of tables, orders, checks and tips. A server would log onto the system, make notations about orders made and filled, and log off. If a server failed to log off, the next server could make notations concerning the prior server’s tables under that server’s still-open session.
Water-bombing involved going onto another server’s still-open session, opening entries relating to that server’s tables, and making notations that water had been ordered when it had not. The first server would then have to check whether the water orders had been filled before closing out the session.
A new server inadvertently failed to log himself out of the system near the end of his shift. To “teach him a lesson,” the employee used his still-open session to place multiple simultaneous orders for water at his assigned tables when no one had ordered anything and indeed, most or all of his tables were empty. The prank forced the new server and the manager to rush to clear the fake water orders before the server’s shift ended.
The water-bombing incident infuriated the general manager. On April 6, 2017, she drafted a “corrective action” memorandum, notifying the employee she was being fired. The memorandum gave three reasons: circumventing the tip-tracking system to avoid paying taxes on tips; the water-bombing incident; and break violations and tardiness on several occasions.
The general manager emailed the memo to the company’s district manager and HR department, requesting approval to terminate the worker’s employment. The general manager then went home for the day.
Later that evening, the employee’s shift manager told the employee to clock out for her meal break but work through the break and take one later. At around midnight, the employee complained to the shift manager about not receiving a meal break.
The next day, on April 7, 2017, the employee was again told to work through her scheduled meal break. She complained to another shift manager about missed breaks and other wage and hour violations.
On April 9, 2017, in response to the general manager’s corrective action memo, the company suspended the employee before her shift was to begin. On April 10, 2017, the employee was terminated.
Lawsuit Filed
The employee subsequently sued the company for whistleblower retaliation. She claimed at trial that the timing of her complaints about wage and hour violations on April 6 and April 7, 2017, and the company’s decision to fire her on April 10, constituted evidence that the firing was in retaliation for the complaints.
She denied that she manipulated the company’s tip-out procedure and testified that her prior write-ups were in the distant past and had nothing to do with her termination. Although she admitted to the water-bombing, she claimed water-bombing was commonly practiced at the restaurant to remind new servers to log out of the computer system so the next server would not have to do so.
The manager testified she did not know about any meal break complaint when making the decision to fire the employee.
The jury awarded the server $200,000 in compensatory damages. The jury further concluded that the company engaged in conduct with malice, oppression or fraud, and awarded the server $100,000 in punitive damages. The company appealed.
Whistleblower Retaliation
Under the California Labor Code, an employer may not retaliate against an employee for complaining about the employer’s noncompliance with any legal obligation or for exercising any right afforded by law.
A whistleblower employee who has suffered an adverse employment action proves a retaliation claim by establishing that retaliation was a contributing factor in the adverse action. After the employee does so, the employer must demonstrate that it would have taken the same action for legitimate, independent reasons, even if the employee had not engaged in protected activities.
The appellate court concluded that there was insufficient evidence to support the claim that the employee’s complaining about missed meal breaks was a contributing factor in the company’s decision to fire her. On the contrary, the court said, uncontroverted evidence established that the general manager decided to fire the employee before she complained.
It was simply impossible, the court said, for the general manager to retaliate against the employee because of a complaint the employee made after the alleged retaliation.
Ortega v. Carson Wild Wings, Calif. Ct. App., No. B309931 (July 31, 2023).
Joanne Deschenaux, J.D., is a freelance writer in Annapolis, Md.