Since the DFEH rarely conducts any administrative hearings, but typically issues a right to sue letter, it is likely that the FEHA complaint will result in a civil lawsuit being filed in fairly short order after release of the right to sue letter.  Although there is now insurance available to cover employer acts, few employers have secured that coverage.  As a result, the employer can anticipate major litigation costs in defending the civil lawsuit.  Therefore, it is in the best interests of the employer to develop its defense as early and as cheaply as possible and to make sure that its defense in the various forums is consistent.

With the 132(a) on file at the WCAB, the Board would have jurisdiction of the issues.  Utilizing that forum, the employer could quickly obtain a deposition of the claimant, solidifying his testimony and producing early information on the discrimination and termination claim.  That deposition can be the basis for whatever internal investigation the company may wish to develop.  It can also provide a foundation for further civil discovery once the right to sue letter is obtained and the civil suit is at issue.  By the time the civil lawsuit is filed, the employer could be well on its way to evaluating its potential liability and determining an overall strategy in the handling of these claims.  Perhaps, at this point, it would be helpful for a further strategy meeting to agree upon whether amicable resolution will be sought, the level of such resolution, or alternative measures such as private or court ordered mediation.

Assuming the underlying workers’ compensation case is ready for disposition, consideration ought to be given to a global resolution of all issues in all forums.  If that is of interest to the employer, a meeting with plaintiff’s representatives should be arranged to determine whether or not a settlement can be negotiated.  All interested parties on the defense side of the matter should attend or at least be available by telephone.  If reinstatement of the employee is the decided upon strategy, then the underlying workers’ compensation case should be resolved by stipulation with a settlement agreement drafted on the 132(a) issue, a dismissal entered in the civil suit with a general release of the employer from liability.  If reinstatement of the employee is not agreed upon, then the underlying workers’ compensation case, including the 132(a) issues, ought to be resolved by Compromise and Release.  That settlement would be in addition to and separate from the dismissal and general release obtained by the employer on the civil issues.

Settling all aspects of the litigation at one time for one large lump sum gives an employee more incentive to resolve all claims globally.  Piecemeal settlements always seem to require more money for each component in order to obtain the interest and consent of the claimant and usually result in higher legal fees, as well.  With any global resolution, care must be taken that the workers’ compensation issues have sufficient monies assigned to them to warrant approval of the settlement by the WCAB.

What are the handicaps of not coordinating the defense?

Failure to coordinate the defense of the underlying workers’ compensation claim, the 132(a), and the FEHA claims result in inconsistent handling of these various elements.  It is not uncommon to find an agreement which is of benefit in controlling the workers’ compensation issues, but which results in increased liability of the employer in the FEHA action.  For example, stipulation to an early permanent and stationary date may be of value in the workers’ compensation case, but may result in a potentially longer period of salary loss in the discrimination suit.  Even the manner in which the settlement documents (a stipulation or Compromise and Release) are drafted may not be of assistance to the employer in the control or resolution of the FEHA action.  For example, a statement in a workers’ compensation settlement that the injured worker is not a qualified injured worker, may result in an advantage in workers’ compensation by precluding vocational rehabilitation.  But such a stipulation may mean the employer must return the injured employee to work.  Statements made in settlement documents may be taken as admissions in the other forum.  Awareness that there are other issues to be considered will result in more careful drafting of documents and in a closer assessment of the overall impact of particular language.

Failure to take advantage of the early discovery potential afforded in the workers’ compensation arena can also be the result of poor communication and coordination.  Likewise, as noted earlier, piecemeal settlements generally result in a higher overall monetary expenditure than would a combined settlement.