August 22, 2023
The California Supreme Court has determined that third parties contracted by employers to screen job applicants can be held responsible under state civil rights law for asking intrusive medical questions, allowing companies acting on behalf of employers to be held directly liable for employment discrimination claims.
The unanimous seven-member state high court said in a 32-page opinion that the definition of "employer" in California's Fair Employment and Housing Act includes business-entity agents with at least five employees who help employers make employment decisions.
The ruling comes in a years-old proposed class action in which workers allege Concentra subsidiary U.S. Healthworks Medical Group asked prospective employees inappropriate questions on behalf of employers, in violation of the FEHA.
The Case
Kristina Raines, who underwent a medical screening after applying for a job as a food service aid, filed suit against U.S. Healthworks and other providers of occupational health services in California in 2019. The suit was later amended to include Darrick Figg, who applied to serve as a member of the volunteer communication reserve at the San Ramon Valley Fire Protection District
The workers alleged the medical providers conducted thousands of invasive screening exams and asked questions unrelated to job responsibilities, such as whether applicants had venereal disease, problems with menstrual periods, prostate or other cancers, mental illness, HIV and hemorrhoids, among other things.
"A business-entity agent's obligation to comply with FEHA and its consequent liability for FEHA violations results from the entity's own engagement in FEHA-regulated activities on the employer's behalf," Justice Jenkins wrote.
The high court said its definition of "employer" as inclusive of third-party agents is also backed up by federal courts' interpretation of federal civil rights statutes, including Title VII, the Americans with Disabilities Act and the Age Discrimination in Employment Act.
The decision will have an impact on the outsourcing many employers do to third-party vendors, particularly platforms that use algorithms to target job ads toward potential applicants.
