Employees who believe they are the victims of workplace discrimination may have a new weapon against their employers in the form of a cause of action called "unfair competition." Many states -- including Pennsylvania -- already have an unfair competition cause of action that is commonly used in commercial litigation. In Pennsylvania, the tort of unfair competition is typically alleged where a business believes that a competitor is attempting to destroy its business by hiring all of its key personnel. However, a recent decision from the California state courts puts a new spin on unfair competition, and may pave the way for unfair competition to be used in the context of employment discrimination cases.

Specifically, last month, a California state court upheld a $5,000,000 age discrimination verdict against Nestle U.S.A., Inc. There, a Nestle supervisor in his mid 40's was repeatedly overlooked for promotions, despite being qualified and having a stellar record of performance. Moreover, employees in their early 30's were given the promotions, despite the fact that they were not qualified for the positions. The supervisor eventually quit after being passed over for the 8th time and sued his employer. Nestle was found liable for age discrimination and the jury awarded the supervisor $5,000,000. The California court's opinion upholding the verdict against Nestle for age discrimination was unanimous. However, in writing its opinion the court noted that employers who practice age discrimination also violate the law of unfair competition. To that end, Justice Joan Dempsey Klein wrote: "An employer which practices age discrimination has an unfair competitive advantage over employers who comply with [the law] because older workers frequently are more highly compensated than their younger colleagues." This is the first time in the United States that the unfair competition cause of action has been applied to workplace discrimination.

This opinion arguably opens the door for another cause of action against employers who are sued for workplace discrimination. However, there is an argument that unfair competition can only be used in age discrimination cases, because age cases are the only discrimination cases where employers can hire a less expensive employee. Although this case may very well add another weapon to the arsenal of the employment discrimination plaintiff, only time will tell whether Pennsylvania courts will follow Justice Klein's lead.

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