California Supreme Court Holds Third Parties Liable for Worker Bias Under FEHA
Highlights
A recent California Supreme Court ruling clarifies that some third-party entities can be held directly liable for California Fair Employment and Housing Act violations, broadening accountability under California's anti-discrimination laws
Employers must ensure compliance within their own operations and with third-party entities in the hiring process, including algorithmic hiring
The decision opens the door to direct liability for third-party agents, possibly leading to more class-action lawsuits
The California Supreme Court's recent decision in Raines v. U.S. Healthworks Medical Group creates new avenues of liability and responsibility for third-party entities involved in the employment hiring process and potentially for the employers who engage such entities. For employers and third-party agents involved in the hiring process, the ruling acts as a firm reminder of the need to ensure compliance with the California Fair Employment and Housing Act (FEHA) at every stage of the hiring process, regardless of whether certain functions are outsourced to third parties.
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