In late 2025 and early 2026, political and media attention has centered on a sprawling set of fraud allegations tied to state-administered assistance programs in Minnesota and the involvement (or perceived political implication) of prominent politicians may lead to workplace discrimination in other states.
These developments have generated headlines for their political implications. But beyond politics, the underlying issues touch on public oversight, program integrity, and protections against discrimination or reputational harm, all of which matter to employers and employees in California.
Here’s what’s going on and why it matters to employees in California:
What Happened: Fraud Allegations in Minnesota
Investigations in Minnesota have focused on alleged misuse of federal funds in several public-assistance programs, including:
A well-publicized pandemic-era child nutrition program fraud case that resulted in federal charges and convictions for dozens of individuals connected to nonprofit and service provider networks.
Viral allegations about fraud at Somali-run daycare and other service providers, which prompted federal involvement and even a temporary freeze on federal childcare funds to Minnesota pending audits.
What’s significant is that these programs receive federal and state funding that is intended to support children, families, and vulnerable residents. Allegations of false billing or services that were never provided raise questions about program integrity and fiscal safeguards.
There is ongoing scrutiny over how much fraud occurred, how oversight was handled, and whether certain communities were unfairly singled out in political debates.
Why This Matters for California Employers & Workers
Even though this controversy centers on Minnesota, it intersects with topics that are highly relevant to California’s employment landscape.
The political and public reactions to the scandal have included accusations of bias toward certain communities, especially Somali-Americans in Minnesota. California employers must be mindful that:
California Government Code Section 12940 prohibits workplace discrimination based on national origin, religion, or identity, even amid highly charged public discourse.
Public narratives that cast members of specific communities as prone to wrongdoing can contribute to bias in hiring, promotion, or discipline unless employers actively counter stereotyping with equitable practices. California’s Fair Employment and Housing Act (FEHA) protects against such practices in employment decisions.
High-profile controversies show how quickly reputational risks can ripple into policy discussions and workplace environments. California employers should be prepared to address misinformation or reputational impacts when public figures or news cycles touch on identities or industries connected to their workforce.
Workplace Discrimination and the Law
A plaintiff can establish a prima facie case for discrimination where (1) he is a member of a protected class, (2) he was qualified for the open position, (3) despite his qualifications, he was rejected, and (4) after his rejection, the position remained open and the employer continued to seek applicants. See McDonnell Douglas Corp. v. Green (1973) 411 U.S. 792, 802. “The burden then must shift to the employer to articulate some legitimate, nondiscriminatory reason for the employee’s rejection.” Ibid. Plaintiff is then afforded a fair opportunity to show that the employer’s rejection was pretext. Ibid. at 804.
Employers may try to disguise their discrimination in many different ways. It’s important to seek a workplace discrimination lawyer to help uncover the pretext.
“To establish discrimination, all agree, the complaining party need show only that race, color, religion, sex, or national origin was “a motivating factor” in an employer’s adverse action; an employer’s proof that “other factors also motivated the [action]” will not defeat the discrimination claim.” University of Texas Southwestern Medical Center v. Nassar (2013) 570 U.S. 338, 364.
Even if the employoer has other “reasons” for the adverse employment action, employees can show that the workplace discrimination was a motivating factor as well.
