California Federal Savings & Loan Ass'n v. Guerra

Background

California’s law requires up to four months of unpaid pregnancy disability leave and, as the state agency interprets it, reinstatement to the employee’s prior job or a substantially similar position. A longtime receptionist took pregnancy leave, returned to find her job filled, and filed a complaint. Her employer sued in federal court, which struck down the state rule; the Ninth Circuit reversed, and the Supreme Court affirmed the Ninth Circuit’s decision.

Reasoning

The Court asked whether Title VII, as amended by the Pregnancy Discrimination Act (PDA), pre-empts the California reinstatement rule. The Justices explained that Congress limited federal pre-emption and preserved state fair-employment laws unless they actually conflict with federal law. The Court read the PDA as setting a minimum standard for pregnancy-related benefits, not a ceiling that forbids stronger state protections. Because California’s statute furthers equal employment opportunity, is narrowly tied to actual pregnancy disability, and can be followed alongside federal law, the Court held the state rule is not pre-empted.

Real world impact

The ruling lets states require unpaid pregnancy disability leave and a qualified right to return to work without being nullified by federal law. Pregnant employees covered by such state rules gain protection against losing their jobs during pregnancy disability. Employers subject to both state and federal law can usually comply with both, provided the state rules are not based on stereotypes or require unequal treatment.

Dissents or concurrances

Justices divided on theory. A dissent argued the PDA mandates identical treatment and would pre-empt California’s statute. Other Justices wrote separately, agreeing with the outcome but offering different legal reasons for upholding the state rule.