## Facts

- Apostol Livitsanos worked for Continental Culture Specialists, Inc. from 1976, rising to general manager and receiving increased compensation, including a percentage of gross sales.
- Livitsanos alleged the employer made oral assurances implying continued employment absent good cause and tying his compensation to company success.
- He worked long hours and later became eligible for profit-sharing conditioned on continued employment.
- Livitsanos alleged defendants engaged in a campaign of workplace harassment (e.g., criticism and false accusations) intended to force his resignation and deprive him of compensation, culminating in termination.
- He sued for wrongful termination and related torts, including intentional infliction of emotional distress (IIED), negligent infliction of emotional distress (NIED), and defamation.
- He alleged severe emotional distress but did not allege physical injury or permanent physical disability.
- The trial court sustained a demurrer to the emotional distress causes of action on the ground that the California Workers’ Compensation Act provided the exclusive remedy; appellate writ proceedings followed, and the California Supreme Court granted review.

## Issues

1. Whether workers’ compensation exclusivity bars civil claims for IIED and NIED arising out of the employment relationship when the employee alleges emotional distress without physical injury or disability.
2. Whether alleged employer harassment and termination-related conduct can fall outside the “compensation bargain” such that tort remedies remain available.

## Decision

- The court held that IIED and NIED claims arising out of and in the course of employment are generally preempted by workers’ compensation exclusivity even if no physical injury or disability is alleged.
- The court reaffirmed that exclusivity applies only to risks within the compensation bargain; conduct that exceeds risks inherent in the employment relationship may support civil liability.
- The court concluded the emotional distress claims, insofar as based on ordinary personnel management and the termination process, were barred by exclusivity.
- The matter was remanded for further proceedings consistent with the court’s views.

## Legal Principles

- California workers’ compensation is the exclusive remedy for industrial injury arising out of and in the course of employment when the injury results from risks encompassed within the compensation bargain.
- Compensable “injury” under the workers’ compensation system includes psychiatric or purely emotional injury; absence of physical disability does not avoid exclusivity.
- Labeling employer conduct as “intentional” does not remove a claim from exclusivity if the conduct is part of normal employment actions (e.g., criticism, discipline, job-related disputes, termination).
- Tort remedies may remain available where the employer’s conduct is outside the compensation bargain—i.e., not a normal risk of employment or qualitatively beyond routine personnel management.

## Conclusion

The court held that workers’ compensation exclusivity generally bars civil IIED and NIED claims for purely emotional distress arising from ordinary workplace and termination-related conduct, while preserving a limited exception for employer conduct outside the compensation bargain; the case was remanded for further proceedings.


Livitsanos v. Superior Ct., 2 Cal. 4th 744 (Cal. 1992)