Debunking a Whistleblower Myth

California’s whistleblower law (Labor Code section 1102.5) protects employees from retaliation for complaining to a person of authority within the company, or to a government or law enforcement agency, about their employer’s violation of a statute or regulation, whether federal, state or local.

Q: When an employee complains about conduct that isn’t illegal, do whistleblower protections still apply?

A: Yes, even when an employee is mistaken about the law, they may still have a whistleblower claim.

A California appeals court recently addressed this question in Contreras v. Green Thumb Produce, Inc. Mr. Contreras, a forklift operator at a produce packaging company, complained to his HR manager that his pay was lower than less-senior employees performing similar duties. Mr. Contreras demanded a raise and provided the HR Manager with printed informational material about California’s Equal Pay Act from the Labor Commissioner’s website in support of his request.

The HR Manager denied Mr. Contreras’ request for a raise and told him he shouldn’t be showing the Labor Commissioner’s informational material around the workplace. Green Thumb fired Contreras the next day, citing various acts of insubordination on Contreras’ part.

Mr. Contreras sued Green Thumb under California’s whistleblower law and the jury found in his favor.

Mr. Contreras Was Mistaken About The Scope Of California’s Equal Pay Act.

California’s Equal Pay Act prohibits employers from paying an employee of another sex, race or ethnicity less for substantially similar duties: it does not cover pay differences that do not involve these protected characteristics. Mr. Contreras acknowledged that he did not believe that his sex, race or ethnicity were the basis of his lower compensation. His understanding of the scope of California’s Equal Pay Act was incorrect.

“Reasonable” Belief About The Law Was Sufficient To Support Mr. Contreras’ Whistleblower Claim.

Mr. Contreras is not a lawyer. He stated he believed the company may have violated the California Equal Pay Act based on the information he reviewed on the Labor Commissioner’s website and a conversation with the Labor Commissioner’s Office prior to the meeting with the HR Manager.

The jury found in favor of Mr. Contreras on his whistleblower claim, determining that his belief that the company violated the law was “reasonable,” (although incorrect) and that Green Thumb terminated his employment in retaliation for his complaint to the HR Manager.

Green Thumb argued that the whistleblower law did not apply because Mr. Contreras mistake about the California Equal Pay Act meant that he was relying on a “nonexistent law” to support his whistleblower claim.

The appeals court disagreed with Green Thumb’s argument, holding that an employee’s belief that a law was violated can still be “reasonable,” even if the employee’s interpretation of the law is incorrect. The standard for a whistleblower claims is a “reasonable” belief that a law was violated. Whether an employee’s belief is “reasonable” is a question for the factfinder – in this case a jury – to decide.

What Should California Employers Take Away From This Case?

In addition to valuable guidance about the scope of whistleblower retaliation claims, the Contreras case provides employers with an important reminder to take all employee complaints seriously and respond in a professional manner, even if it appears at the outset that the employee does not understand the law or has their facts wrong.

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