Well, as I mentioned, I don't have a lot of optimism. California is an employment-at-will state, which basically means that either the employer or the employee can modify or terminate the employment relationship at most any time and for most any reason. For this reason, unlike some other jurisdictions, there is no presumption that the employer has an unequal bargaining position, so there are no extra protections in place for the employee; if either side does not like their arrangement, they have the right to quit. The employee can quit the relationship if he does not like the employer, and the employer can quit the relationship if it does not like the employee. So an employer can generally discriminate against an employee for most any reason. It's not fair, but it's generally legal.
This is not without limitation. Some reasons for discrimination are illegal; for example, it is illegal to discriminate against an employee because of their race/color, gender, religion, ethnicity, age (if over 40) disability, genetic information, or in retaliation because the employee is a whistle-blower. It is not illegal, however, to discriminate for reasons that are simply unfair or ill-informed. The breakdown of inter-personal relationships is generally a valid reason.
On the other side of the equation, this also does not give the employer or employees a blank check to spread rumors. Even if an employer has the right to discriminate, this does not give it the right to make objectively false statements. Defamation of character is (1) a false statement (2) which exposes a person to public contempt, ridicule or disgrace or causes others to think badly of the person defamed (3) and is made to a third party. When the defamation pertains to the plaintiff's work or business, it is considered "defamation per se", meaning that the plaintiff can prevail without proving actual damages (meaning, even if you are not fired and even if you are not disciplined, you can be awarded money damages). Everyone is entitled to their opinions, but when that opinion amounts to objective falsity, they can be held responsible for their statements.
Because the nuances of every case are different, you should not rely on this information as advice or apply it to a specific situation without a more thorough consultation with counsel.
Let me know if further clarification is needed, and please keep in mind that the experts are not credited for unaccepted answers; even where I cannot solve every problem in a case, my hope is that you can at least feel confident in your knowledge so you can get the best outcome under the circumstances, whatever that outcome may be. Please remember to click accept once you are finished. Thank you.