New Jersey Employment Lawyer Blog

New Jersey's Appellate Division recently upheld a jury verdict which found Avaya, Inc. liable for retaliation in violation of the New Jersey Law Against Discrimination. The case is LaFranco v. Avaya, Inc. It involves an employee, Mark LaFranco, who responded to his supervisor's anti-Semitic statement by emphatically indicating that he is Jewish. In an unpublished opinion, the appellate court found the tone and context of Mr. LaFranco's response indicated he was offended by the statement. In addition, Mr. LaFranco reasonably believed the comment was religious discrimination. Accordingly, his response was a legally protected objection to unlawful discrimination.

Mr. LaFranco worked as a salesperson for Avaya, a telecommunications company, for more than 12 years. He frequently exceeded his sales quotas and received large commissions. Prior to 2002, all of his performance reviews were positive.

In August 2001, Mr. LaFranco reported to his boss, Patrick Iraca, that he had been improperly denied $10,000 in commissions. Mr. LaFranco subsequently reminded Mr. Iraca of the issue, and suggested that Mr. Iraca should discuss it with his boss. In response, Mr. Iraca asked, in a disgusted voice, "What are you, a Jew?"

Mr. LaFranco, who is half Jewish, was shocked and insulted by the question. He turned and looked at Mr. Iraca before he responded, "Yeah, I am." He then stared at Mr. Iraca for several seconds before Mr. Iraca turned and stormed out of the room. Mr. Iraca did not speak to Mr. LaFranco for the rest of the evening.

From that point on, Mr. Iraca's attitude toward Mr. LaFranco was hostile and malicious. Among other things, he undermined Mr. LaFranco's sales efforts, subjected him to unnecessary criticism and scrutiny, failed to give him credit for many of his sales, disproportionately increased his sales quota, decreased his sales territory, excluded him when he redistributed a former salesperson's territory, and berated him in front of his peers. Mr. Iraca also included unwarranted criticism in Mr. LaFranco 2002 performance review, such as falsely accusing him of insubordination. He then placed Mr. LaFranco on a performance development plan, because it was a necessary step before he could fire him. Shortly thereafter, Avaya fired Mr. LaFranco.

The New Jersey Law Against Discrimination prohibits employers from retaliating against an employee because he opposes a practice he reasonably believes violates the Law Against Discrimination. For example, it is unlawful to retaliate against an employee who makes a good faith objection to discrimination or harassment due to age, race, gender, or religion.

In LaFanco, the jury found that Mr. LaFranco proved Avaya retaliated against him because he had opposed an act he reasonably believed was discriminatory. The Appellate Court upheld the jury's verdict. It found Mr. LaFranco reasonably believed Mr. Iraca's question, "What are you, a Jew?," was an act of religious discrimination. It also concluded that under the circumstances, including Mr. LaFranco's tone and demeanor, his response "Yeah, I am" clearly opposed Mr. Iraca's discriminatory practice.

The Appellate Division affirmed Mr. LaFranco's jury verdict of $158,310 in lost wages, $1,000 in emotional distress damages, more than $10,000 in prejudgment interest, and over $365,000 in attorney's fees. The jury also awarded Mr. LaFranco $45,000 for failing to pay him commissions in breach of his employment contract.

On December 22, 2009, President Obama signed into law the Fiscal Year 2010 Defense Appropriations Act. This new employment law extends the period during which certain employees who are laid off or otherwise lose their jobs through no fault of their own can receive a federal subsidy of their health care costs.

More specifically, this new law extends the period of the subsidy under the American Recovery and Reinvestment Act, commonly called the 2009 Economic Stimulus package. Specifically, for a limited period the United States government will pay 65% of the health insurance premiums for qualified employees, for up to nine months after an employee is involuntarily fired or laid off. Under the Stimulus package, that subsidy applies to qualified employees who lose their jobs between September 1, 2008 and December 31, 2009. The 2010 Defense Appropriations Act extends that period through February 28, 2010. It also extends the maximum length of the subsidy from 9 months to 15 months.

This benefit applies to former employees who are covered by the Consolidated Omnibus Budget Reconciliation Act (COBRA) who involuntarily lose their jobs between September 1, 2008 and December 31, 2009. COBRA applies to people who are eligible to receive health insurance benefits from a company with at least 20 employees. The government subsidy also applies to former employees who work in states that have "comparable continuation coverage" that apply to smaller companies (often called mini-COBRA laws). That includes employees who work for smaller companies in both New York and New Jersey.

The government stipend is reduced for people who make more than $125,000 per year, and married couples who file joint tax returns and earn more than $250,000 combined. The benefits phase out completely for individuals who make more than $145,000 and for couples filing joint tax returns who earn more than $290,000 combined.