The recent NJ Supreme Court decision in Battaglia v. United Parcel Service, Inc. initially caught our eye because it deals with the question whether a CEPA (whistleblower) count in a complaint prevents the plaintiff from pursuing a LAD (discrimination) count based upon the same employment scenario. While it does address that issue, it does much, much more.
Here are the basic facts, summarized from a rather long opinion. The plaintiff is a former manager for UPS. He was party to conversations in the workplace in which his supervisor used derogatory and offensive language about females to a group of male employees. No women heard the derogatory comments. After talking to the supervisor and expressing his concern he also filed an internal complaint. No action was taken and the supervisor continued to use such language. At this point plaintiff sent an anonymous complaint letter about the remarks as well as other behavior that he considered unethical. UPS investigated and took no action, but did determine that it was plaintiff who sent the letter. Plaintiff was demoted and became depressed. He filed suit against UPS on three grounds. (1) That the was demoted in retaliation for complaining that the language used violated LAD. (2) That he was demoted in retaliation for filing a complaint about unethical practices in violation of CEPA. (3) That UPS breached an implied contact because its employee manual states that employees will not be punished for filing a complaint.
Confused yet? This is where things get interesting.
After a jury trial, the trial court dismissed the contract claim but ruled for plaintiff on the LAD and CEPA counts. Plaintiff was awarded damages, including damages for future emotional distress.
The parties cross-appealed from all adverse rulings. The Appellate Division held, among other things, that the LAD claim was not sustained by the evidence because (1) no female employees heard the offensive language and (2) since the male plaintiff was not the subject of the offensive language, there was no violation of LAD.
That was how the case was presented to the Supreme Court.
The Court ruled that the breach of contract claim was properly dismissed. So much for the easy part.
On the CEPA claim, the verdict in favor of plaintiff was reversed. The court emphasized the remedial nature of CEPA. Noting CEPA's statutory exclusivity, the Court still held that a CEPA claim and a claim for retaliation under the LAD are not always mutually exclusive. However, the trial courts were admonished to ensure against overlapping claims in light of the Legislature's determinatiomn that alternative remedies are waived under CEPA. The Court also emphasized that under CEPA the evidence must specifically support the claim. Here, plaintiff's claims did not meet that burden.
With respect to the LAD claim, the court found that the plaintiff had proved his case. Again choosing to emphasize the remedial nature of an employment statute (LAD), the Court rejected a narrow interpretation of the law, opting instead for a broader interpretation to hold that LAD does not require evidence of actual discrimination to sustain a claim for LAD retaliation. In plainer terms, although no woman heard the geneder-based sexual language, and plaintiff heard it but was not a woman, he properly stated a claim for retaliation because he complained about it in good faith.
There's more. It is well-established that a plaintiff can collect damages for emotional distress resulting from LAD or CEPA violations based solely upon lay testimony. In other words, no expert testimony, such as from a psychologist or psychiatrist, is necessary. Except when the plaintiff is trying to prove permanent emotional distress. Now an expert plainly is needed for any claim for emotional distress that seeks to recover damages beyond the date of the trial verdict.
So what to make of all this? Employers need to be increasingly aware of the need to take seriously all allegations of retaliation based upon LAD and CEPA. The courts will evaluate any adverse employment action against complaining employees under a very liberal standard. The results can be somewhat counter-intuitive, making this a dangerous area for employers to tread without legal counsel.
Plaintiff attorneys need to be aware of the enhanced proof requirement for emotional distress, along with the increased latitude now available to them for retaliation claims.
H/T to our summer intern, Kiernan Ensor, who struggled manfully to get a handle on something this complex as one of his first assignments. There's nothing like getting thrown into the deep end of the pool. Kiernan managed to float.