New Jersey Employment Lawyer Blog
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Last month, New Jersey passed a new employment law that provides some protection to individuals who have criminal records. Officially named The Opportunity to Compete Act, the law is more commonly referred to as a “ban-the-box” law because it limits when employers can include a box on job applications to indicate whether the job candidate has been convicted of a crime.

The law was passed because it has become extremely common for large companies to conduct criminal background searches before they make hiring decisions. According to the New Jersey Legislature, this impacts tens of millions of adults who have criminal records, even though they can make a valuable contribution to the workforce. The Legislature considers this particularly important since finding employment significantly reduces the likelihood someone will repeat their criminal behavior.

The Act prohibits employers from requiring job candidates to indicate whether they have a criminal record, or from asking questions about a job candidate’s criminal record during the job application process. However, it permits employers to ask limited follow up questions if a job applicant discloses that he or she has a criminal history.

Officer Arresting Young ManThe law, which will not go into effect until March 1, 2015, permits employers to ask an individual about his or her criminal history once they decide the individual is their first choice for a position. It also permits employers to refuse to hire someone based on their criminal record. However, it prohibits employers from considering an arrest or accusation that did not result in a conviction (unless it is still pending) or to consider any criminal record that has been expunged or pardoned (with limited exceptions under federal and state law).

The law also restricts employer from considering older convictions (more than 5 years old for disorderly persons offenses, and generally more than 10 years old for crimes). However, the 10 year period does not apply to specific very serious crimes, including homicide, attempted murder, arson, sex offenses, robbery, kidnapping, human trafficking, weapon possession during certain crimes, burglary, aggravated assault, and terrorism.

If an employer asks an employee about his or her criminal history as permitted by the act, it is required to consider other factors including the nature of the offense; how long ago the offense occurred; the job duties and settings of the job; information about the accuracy of the criminal record; and information about the job candidate’s rehabilitation and good conduct.
With limited exceptions, the law prohibits employers from publishing advertisements which indicates they will not consider job applicants who have been arrested or convicted in the past.

The law includes exceptions to numerous provisions for job openings in law enforcement, corrections, the judiciary, homeland security or emergency management. It also invalidates and supersedes any county or local laws or regulations regarding using criminal background information in the employment context.

The law applies to both employees and independent contractors. However, it applies only to employers with 15 or more employees over a 20 week period. It expressly applies to the state, counties and municipalities, as well as job placement companies and employment agencies.
Unfortunately, violations of the law come with a very limited penalty. Specifically, the maximum penalty for violating the law is $1,000 for a first violation, $5,000 for a second violation, and $10,000 for any subsequent violations. The law does not include any other remedies, and does not permit a private claim against companies that violate it.

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Earlier this month, in Temple-Inland, Inc. v. Kenneth Dee, New Jersey’s Appellate Division ruled that a company could be liable for failing to inform an employee about a change to its commission plan until after the change went into effect. The case also addresses numerous other issues in a complex dispute between the company and its former employee.

Sales people working on electronic tabletKenneth Dee worked as a salesperson for Temple-Inland, Inc. for fourteen years. Temple-Inland paid Mr. Dee a base salary plus commissions. The company eventually changed how it was calculating commissions. It apparently substantially reduced Mr. Dee’s commissions in comparison to his peers because he had been receiving extraordinarily high commissions from his best customer, Church & Dwight.

Mr. Dee complained about his reduced commissions. According to Mr. Dee, the Regional Vice President of Sales and Marketing indicated the company would address this by performing an audit. Mr. Dee further claims that although the audit revealed he was being underpaid, the company did nothing to remedy the situation.

On August 27, 2010, Mr. Dee accepted a job offer with one of Temple-Inland’s competitors, Packaging Company of America (“PCA”). Before he resigned from Temple-Inland, he downloaded price lists and account information for his accounts from a password-protected computer.

While he was still working Temple-Inland, Mr. Dee met with Church & Dwight to solicit its business for PCA. On his last day of work for Temple-Inland, he received an email from Church & Dwight seeking a Request For Proposal (“RFP”), but did not mention it to anyone at Temple-Inland. Temple-Inland ultimately learned about the RFP and submitted a bid.

Temple-Inland filed a lawsuit against Mr. Dee, claiming he breached his fiduciary duty to it and misappropriated its confidential and proprietary information. Mr. Dee filed various counterclaims seeking additional commissions.

The trial court granted an injunction prohibiting Mr. Dee from using the company’s confidential information in the future, but dismissed the rest of Temple-Inland’s case because it did not prove it suffered any actual injury or damages. It also dismissed all of Mr. Dee’s counterclaims. Both parties appealed.

In an unpublished opinion, the Appellate Division concluded the company did not breach Mr. Dee’s employment contract since its commission policy did not require it to adjust Mr. Dee’s commissions after an audit. However, it found evidence to support an equitable estoppel claim. Equitable estoppel is when someone intentionally misleads you into doing something based on an understanding you will receive something in return, when it would be unfair and unjust for the other party not to fulfill those expectations. The court concluded Temple-Inland could have misled Mr. Dee to believe his commissions would be adjusted when it told him it would address the discrepancies to his commissions through its audit. It also found Temple-Inland may have violated the New Jersey Wage Payment Act by failing to tell Mr. Dee in advance that it was reducing his commissions on the Church & Dwight account.

With respect to Temple-Inland’s claim that Mr. Dee violated his duty of loyalty, the court explained that an employee can accept a job with a competitor while he is still employed by his current employer. However, the duty of loyalty prohibits a current employee from acting contrary to his employer’s interest, competing with his employer, or assisting its competitors. The Court agreed with the lower court that although Mr. Dee violated his duty of loyalty, there was no evidence to support a damages claim against him.

Likewise, the court affirmed the dismissal of Temple-Inland’s duty of loyalty claim against Mr. Dee. It found evidence that Mr. Dee intentionally withheld information regarding Dwight & Church’s RFP from his employer, in violation of his duty to it. However, it concluded there was no evidence this caused Temple-Inland any harm.

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New Jersey’s Appellate Division recently ruled that a treating physician can testify about an employee’s disability without submitting an expert report. Normally, a witness who is going to provide an expert opinion is required to submit a formal report explaining his or her opinions prior to the trial.

Patricia Del Vecchio worked as police dispatcher for the Township of Bridgewater for approximately a decade. Over the last five years she held that position, her gastroenterologist, Gary Ciambotti, M.D., wrote fourteen doctors’ notes indicating that due to a variety of gastroenterological conditions, including irritable bowel syndrome, Ms. Del Vecchia should not work the night shift unless it was an emergency.

For three years, Bridgewater did not require Ms. Del Vecchio to work the night shift, but eventually it asked her to transfer to the midnight shift. She indicated she did not want to work the midnight shift because of her medical condition. In response, Bridgewater told her that if she did not accept a transfer to another job it would fire her.

Police Dispatcher Working At ConsoleMs. Del Vecchio accepted a transfer, and Bridgewater assigned her to be a clerk in the Police Department’s records office. Bridgewater fired her approximately 7 months later, claiming she excessive absenteeism. Ms. Del Vecchio sued, claiming Bridgewater fired her instead of providing her a reasonable accommodation for her disability, in violation of the New Jersey Law Against Discrimination (“LAD”).

At the trial, the judge limited Dr. Ciambotti’s testimony because he did not submit an expert report. The judge allowed Dr. Ciambotti to testify about the fact that he treated Ms. Del Vecchio for irritable bowel syndrome, and permitted Ms. Del Vecchio to use his notes to prove she requested an accommodation. However, the judge ruled he could not testify about Ms. Del Vecchio’s medical condition, and instructed the jury it could not use his notes to support Ms. Del Vecchio’s claim that had a disability.

Bridgewater had its own expert, Steven Fiske, M.D., who explained irritable bowel syndrome to the jury. However, Dr. Friske testified that even though he has treated thousands of patients who have that condition, none of them were unable to work a night shift because of it. He also stated it was possible Ms. Del Vecchio was malingering, meaning she might have been using her medical condition as an excuse to avoid being assigned to an undesirable shift.

The jury found against Ms. Del Vecchio, concluding she did not establish she had a disability within the meaning of the LAD. Ms. Del Vecchio asked the judge to grant her a new trial, which he denied. She then appealed, arguing the trial judge improperly limited Dr. Ciambotti’s testimony.

In Del Vecchio v. Township of Bridgewater, the Appellate Division reversed. Relying on two previous New Jersey Supreme Court opinions, it explained that although a treating physician usually is an “expert,” they are not required to provide an expert report to be able to testify about facts relevant to their evaluation and treatment of their patient. Accordingly, it ruled Dr. Ciambotti should have been permitted to testify about Ms. Del Vechhio’s illness, diagnosis, treatment and progress.

The Appellate Division further found it was substantially likely the exclusion of this evidence may have changed the outcome of the trial. In particular, it found that limiting Dr. Ciambotti’s testimony so severely effectively left the jury with nothing to rely upon other than Dr. Friske’s testimony. Accordingly, it ruled that Ms. Del Vechhio is entitled to a new trial.

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A few weeks ago, the United States Equal Opportunity Commission (EEOC) issued new enforcement guidelines regarding the federal Pregnancy Discrimination Act (PDA) and related claims under the Americans with Disabilities Act (ADA).

The PDA prohibits most employers from discriminating against employees based on pregnancy, childbirth or related medical conditions. It also requires them to treat women based on their ability or inability to work, rather than based on pregnancy, childbirth, or related medical conditions. The ADA prohibits employers from discriminating against employees because they have a disability, including a pregnancy-related disability. It also requires employers to provide reasonable accommodations to permit disabled employees to perform the essential functions of their jobs.

Casual pregnant businesswoman smiling at computer at her desk inThe EEOC’s guidelines make it clear employers cannot discriminate against employees based on a current or past pregnancy. It notes employees are more likely to prove discrimination claims based on past pregnancies when the employer takes an adverse action (such as termination or demotion) relatively quickly after the employee gave birth. For instance, there can be a strong inference of pregnancy discrimination when an employer takes a negative action while the employee is still on a maternity leave, or right after she returns from one.

The EEOC further explains that the PDA prohibits employers from discriminating against employees because they intended to get pregnant. Accordingly, employers should not ask job candidates or employees whether they intend to become pregnant. The EEOC considers such questions evidence of discrimination if the employer subsequently takes a negative job action against the individual.

The guidance notes that although it would be impossible for an employer to discriminate against an employee based pregnancy unless it knows the employee is pregnant, a company can learn an employee is pregnant in a variety of ways including from the employee herself, through rumors or office gossip, or because the employee is visibly pregnant.

In addition, the EEOC states that employers cannot act based on assumptions and stereotypes about pregnant women, such as assuming they will have attendance problems or will not return to work after they give birth. Likewise, as long as an employee can perform her job an employer cannot force her to take a leave of absence because she is pregnant. This is true even if the employer believes it is acting in the employee’s best interests.

The EEOC explains that employers have to treat women who are pregnant, have recently given birth, or have a related medical condition the same way as they treat other employees of comparable ability (or inability) to perform their jobs. That applies with respect to providing modified or light duty work, paid or unpaid time off, and temporary reassignments. To the extent a pregnant employee requests something the employer has provided to a disabled employee as a reasonable accommodation, the employer must treat the pregnant employee equally, but it can deny the accommodation if doing so would impose an “undue hardship.”

The guidelines explain it can be unlawful for an employer to discriminate against an employee because she is lactating or breastfeeding since those are pregnancy-related medical conditions specific to women. For instance, an employer must provide the same rights to an employee who needs to lactate as it would provide to a disabled employee. In addition, the Affordable Care Act requires employers to provide hourly employees who are breastfeeding break time and a private place where they can express milk.

The EEOC also indicates that federal law prohibits discrimination against a female employee because she had an abortion, chose not to have an abortion, or is considering having an abortion. Likewise, they indicate federal law prohibits employers from making employment decision based on whether or not a female employee uses contraceptives.

Moreover, the guidelines note that discrimination against an employee because she is a caregiver does not violate the PDA. But as I have previously discussed, the EEOC previously explained when federal law prohibits Discrimination Against Caregivers.

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A recent Appellate Division opinion recognizes that firing an employee because he or she is in the process of getting divorced violates the New Jersey Law Against Discrimination (LAD) because it constitutes marital status discrimination.

Robert Smith worked for the Millville Rescue Squad for 17 years as an emergency medical technician (EMT) for 27 years. Mr. Smith’s wife, who also worked for Millville, was one of his subordinates. The couple separated after Mr. Smith’s wife learned he had been having an affair with another subordinate.

Mr. Smith told his supervisor, John Redden, that he had his wife had separated, and indicated he did not think there was any chance he would reconcile with her. Millville fired Mr. Smith approximately six weeks later.

According to Mr. Smith, Mr. Redden told him Millville was firing him because he supposedly was going through an ugly divorce with his wife. In contrast, Millville claims it fired Mr. Smith as part of a job restructuring and Mr. Smith’s allegedly poor job performance.

closeup of a lawyer sitting in his desk showing a divorce decreeMr. Smith filed a lawsuit in which he claims Millville fired him because of his marital status, in violation of the LAD. The case went to trial, but the judge dismissed the case after Mr. Smith presented all of his evidence. The trial court found Mr. Smith’s evidence could not support a marital status discrimination claim because there was no evidence Millville fired him because he was married or not married. It concluded that employers have the right to fire employees because they are concerned that their divorce would become messy.

However, in the unpublished opinion of Smith v. Millville Rescue Squad the Appellate Division disagreed. It concluded that for purposes of the LAD, “marital status” means more than either being married or single. For example, it also includes being engaged, separated, or involved in divorce proceedings.

The Appellate Division found Mr. Smith’s alleged facts, if true, would be direct evidence of marital status discrimination. In particular, a jury could find Mr. Redden’s statements to Mr. Smith were admissions that Millville decided to fire him because it assumed his divorce was going to be ugly.

The Appellate Division expressly rejected the trial court’s finding that Millville had the right to fire Mr. Smith because of its fear his divorce would turn ugly. It deemed this rationale to be based on stereotypes about divorcing spouses, including the assumption that they “are antagonistic, uncooperative with each other, and incapable of being civil or professional in each other’s company in the workplace.” The court explained that although it would be lawful for an employer to fire an employee because of his or her actual negative behavior at work caused by a difficult divorce, there was no evidence of any such behavior by Mr. Smith. Rather, Millville “acted on a fear, apparently based in stereotype that such conduct would follow.”

The Appellate Division also explained that employers can enforce anti-nepotism rules that prohibit two related employees from working for the same employer even if it means firing an employee because his or her spouse also works for the same employer. However, Millville fired Mr. Smith because he was getting divorced, not because he and his wife worked for the same company. Further, the court found it was irrelevant that Millville did not fire other employees who were divorced or divorcing, since it apparently was discriminating against a “subset of divorcing employees,” namely “those married to a fellow employee.” Accordingly, it remanded Mr. Smith’s case for a new trial.

 

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Last month, a judge in the United States District Court for the District of New Jersey ruled that an employee who files a wage and hour claim with the New Jersey Department of Labor (“NJDOL”) can be protected from retaliation under the Fair Labor Standards Act (“FLSA”) even if her original claim did not assert that her employer violated the FLSA.

Veronica Reilly worked for Quick Care Medical, P.C., as an office manager. She filed a claim seeking to recover unpaid vacation time and overtime pay with the NJDOL. Specifically, she claimed the company failed to pay her $673.20 to which she was entitled when she used a week of her accrued vacation time. She also claimed she was improperly denied $168.40 in overtime pay. She brought her claims under two state laws, the New Jersey Wage Collection Statute and the Wage Payment Law Statute. Ms. Reilly won both of her claims, and the NJDOL ordered Quick Care to pay the full $841.60 she sought in vacation and overtime pay.

Office ManagerAccording to Ms. Reilly, when she returned to work on the day of her hearing at the NJDOL, her boss, Dr. Neerja Misra, reprimanded her for failing to tell the company she was going to be late for work that day. Dr. Misra apparently told Ms. Reilly not to come to work for the next three days, and then fired Ms. Reilly when she returned to work on the fourth day after her hearing.

Ms. Reilly filed a lawsuit alleging that both Quick Care and Dr. Misra violated the FLSA by firing her because she filed her claim with the NJDOL. The FLSA is a federal law which, among other things, regulates employee compensation and overtime pay. It also prevents an employer from firing an employee because he or she makes a complaint related to one of the FLSA’s provisions.

Quick Care and Dr. Misra asked the court to dismiss Ms. Reilly’s claim, arguing the FLSA’s anti-retaliation provision did not apply because she filed her original claim under New Jersey law rather than under the FLSA. However, the court disagreed. It explained that the FLSA does not indicate it protects an employee only if he or she files a claim that expressly refers to the FLSA by name. Rather, it protects employees who bring claims “related” to the statute. The court found this means the claim must relate to an issue covered by the FLSA, such as a claim about wages or overtime pay. It noted that numerous other courts have reached the same conclusion that the FLSA prohibits employers from retaliating against employees because they file wage and hour claims in state agencies. Thus, in Reilly v. Quick Care Medical it ruled that Ms. Reilly’s complaint to the NJDOL is covered by the FLSA’s anti-retaliation provision. Accordingly, it permitted her to continue to pursue her case.

For more information about retaliation claims under the FLSA you might want to read our previous article: U.S. Supreme Court Rules FLSA Forbids Retaliation Against Employees Who Make Oral Complaints.

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A recent decision by the New Jersey District Court addressed important issues regarding retaliation following an employee’s request for a reasonable accommodation and time off under the Family and Medical Leave Act (“FMLA”).

Supermarket CartsIn Boles v. Wal-Mart Stores, Inc., plaintiff Barry Boles worked for Wal-Mart Stores, Inc. for approximately ten years. As a result of a medical condition, his physician signed him out of work for approximately five months, which included several extensions of leave. Wal-Mart retroactively approved his FMLA leave (12 weeks), and designated his remaining time off as personal leave. The plaintiff claimed he did not receive documentation regarding how his leave was allocated or indicating he could be fired if he failed to return to work following his FMLA leave. Within three days after Boles returned to work, Wal-Mart terminated him for failure to return to work following his approved leave.

The plaintiff had received a performance warning approximately two weeks prior to taking leave. Shortly thereafter, Wal-Mart claimed that on one occasion prior to his leave he failed to complete certain overnight job responsibilities and to notify his supervisors that he was leaving early.

The plaintiff brought claims for (1) retaliation for seeking an extension of medical leave in violation of the New Jersey Law Against Discrimination (“LAD”); (2) disability discrimination under the LAD; (3) failure to reasonably accommodate his disability under the LAD; and (4) interference with his FMLA rights.

Reasonable Accommodation

Regarding the reasonable accommodation claims, Wal-Mart argued the plaintiff could not meet his burden of proof because “taking medical leave does not constitute protected activity that would support a retaliation claim under the NJLAD.” The Court rejected this argument and held that the LAD’s anti-retaliation provision includes as “protected activity” requesting and taking medical leave. As a result, employers found to have retaliated against employees for requesting or taking medical leave can be liable. The Court also found there was sufficient evidence to support the plaintiff’s claim that his discharge was motivated by Wal-Mart’s resentment toward his request for leave. In so concluding, the Court relied on (1) an email his direct supervisor sent to his own supervisor about discharging the plaintiff during his FMLA leave; and (2) the fact that Wal-Mart discharged the plaintiff only three days after he returned to work.

The Court, however, held that because the plaintiff had received a warning indicating unsatisfactory work performance, left work without notifying his supervisors, and failed to complete certain overnight work, he could not meet the necessary initial showing for a disability discrimination case. In particular, the Court concluded that the plaintiff was not meeting his employer’s reasonable expectations regarding his work performance. Surprisingly, the Court also held the plaintiff did not request a reasonable accommodation when he provided a physician’s certification indicating he needed leave beyond the date he originally requested. The Court found the plaintiff did not directly request additional leave from his employer, but rather merely submitted a certification from his physician indicating a later return to work date. The Court found these facts could not maintain a claim for a failure to accommodate a disability. The Court then granted summary judgment to Wal-Mart in these respects.

FMLA Interference

The Court stated it was unclear whether Wal-Mart provided the plaintiff adequate notice that he was eligible for FMLA leave or sufficient information regarding the expiration of his FMLA leave. The Court found that the plaintiff may have been prejudiced by the company’s failure to provide adequate notice since he may have made alternative plans if he understood he could be fired if he did not return to work prior to the expiration of his approved leave. As a result, the Court denied Wal-Mart summary judgment as to the plaintiff’s claim of interference with his FMLA rights.

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New Jersey’s Appellate Division recently ruled that employers can enforce agreements that shorten the statute of limitations for employees to bring claims against them.

Employment ApplicationSergio Rodriguez applied for a job as a helper at Raymour & Flanigan in August 2007. Mr. Rodriguez was born in Argentina and speaks limited English. He filled out a job application, which was in English, with help from a friend. The application included a provision that if Mr. Rodriguez was hired he would have only six months to file a lawsuit after any employment-related claim arose. It also expressly waived any statute of limitations to the contrary, and his right to a jury trial. Mr. Rodriguez signed and submitted the employment application. Raymour & Flanigan hired him the following month.

In 2010 Mr. Rodriguez injured his knee at work. He took a medical leave, had surgery and returned to work on light-duty in September 2010. By September 28, 2010 he was working without restrictions.

Three days later, Raymour & Flanigan announced a reduction in force, and terminated Mr. Rodriguez , along with 101 other employees. Nine months later, Mr. Rodriguez filed a lawsuit claiming Raymour & Flanigan fired him because he had a disability, in violation of the New Jersey Law Against Discrimination (“LAD”), and because he filed a workers’ compensation claim, in violation of the New Jersey Workers’ Compensation Act. Normally, each of those claims has a two-year statute of limitations.

Mr. Rodriguez argued the provision shortening the statute of limitations was unconscionable and unenforceable. The Court found Mr. Rodriguez’s job application was a “contract of adhesion,” meaning it was something he could not have been expected to try to negotiate or change. But it found the employment contract was not so over-reaching or unfair that no reasonable person who understood it would have voluntarily agreed to it. It relied on factors including that (1) the relevant language was in bold print and capital letters in a two-page contract, not buried in fine print in a lengthy document; (2) the provision was relatively clearly and simple; and (3) Mr. Rodriguez was able to take the agreement home and read it at his leisure rather than being pressured to sign it on the spot.

The court explained that an agreement to shorten a statute of limitations is enforceable as long as the agreed-upon deadline is reasonable and does not violate public policy. It found both of those conditions were met here, particularly since employees who want to bring LAD claim through the New Jersey Division on Civil Rights (DCR) have to do so within a similar 180-day deadline.

The opinion in Rodriguez v. Raymours Furniture Co., Inc. is published, meaning it is a binding legal precedent. Unless and until it is overturned, more employers are likely to require their employees to agree to similar limits to the statute of limitations. As a result, more employees are likely to inadvertently forfeit their right to sue for discrimination or retaliation because they did not know or remember what they signed. This could force employment lawyers to file lawsuit rather than attempt to negotiate first, out of fear their clients might have agreed to a shorter deadline to assert their legal claims.
There are many important lessons of the Rodriguez case. For example, going forward it is even more important that you:

  1. Carefully read the language of any job application or employment contract, and make sure you understand and agree with them before you sign them;
  2. Save copies of any job applications and employment agreements you sign so can look back at them and potentially provide them to an employment lawyer in the future; and
  3. Contact an employment lawyer as soon you believe you were fired unlawfully or have another claim against your employer.
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On June 16, 2014, the New Jersey Supreme Court ruled that by the Conscientious Employee Protection Act (“CEPA”) did not protect an employee who was fired after he objected because the nursing home for which he worked was not taking sufficient steps to prevent the spread of infectious disease. In the process, it concluded that to be protected by CEPA an objection has to relate to a measurable standard or requirement.

CEPA is New Jersey’s broad “whistleblower” law. Among other things, it prohibits employers from retaliating against employees because they object about activities they reasonably believe constitute “improper quality of patient care,” including any professional code of ethics, or are “incompatible with a clear mandate of public policy concerning the public health.”

James Hitesman, a registered nurse, worked for Bridgeway, Inc., at nursing home in Bridgewater, New Jersey. Bridgeway fired Mr. Hitesman after he complained to the company’s management about high rates of infectious diseases at the nursing home, and raised similar concerns to the Somerset County Department of Health, New Jersey Department of Health and Senior Service, and a television reporter. He sued, claiming Bridgeway fired him in violation of CEPA.

Mr. Hitesman won his retaliation case at a trial, but the jury did not award him any damages. He appealed, asking for a new trial on damages. Bridgeway also appealed, arguing Mr. Hitesman’s objections were not protected by CEPA. The Appellate Division agreed with the company, finding Mr. Hitesman did not have an objectively reasonable belief that its actions either constituted improper quality of patient care or were incompatible with a clear mandate of public policy.

Body Temperature Check UpIn Hitesman v. Bridgeway, Inc., the New Jersey Supreme Court affirmed the dismissal of Mr. Hitesman’s case. To win a CEPA case, an employee has to identify a law, rule, regulation, clear mandate of public policy, or professional code of ethics that has a close enough connection (“substantial nexus”) to the objection or complaint the employee alleges caused the company to retaliate. In Hitesman the Supreme Court ruled the employee’s objection must indicate that the employer violated a standard against which the employer can measure its conduct. For instance, it is not enough to complain that the employer should have done something safer, healthier, or better for the environment. Rather, an employee must object believe the employer was required to do something it failed to do, or was prohibited from doing something it did do.

Mr. Hitesman argued his objections were protected by CEPA because he reasonably believed the nursing home violated the American Nursing Association (ANA) Code of Ethics. The Court agreed a medical ethical code like the ANA Code can be the source for a standard of patient care under CEPA. However, it found the ANA Code did not protect Mr. Hitesman because it does not include any specific requirements for hospitals to control the spread of infection. Rather, it sets general goals and requirements for nurses, such as being committed “to the health, well-being, and safety” of patients, and taking “appropriate action regarding any instances of incompetent, unethical, illegal, or impaired practice by any member of the health care team or the health care system.”

Mr. Hitesman also argued based on the fact that Bridgeway’s Employee Handbook required him to comply with the ANA Code. However, the Court ruled that the handbook did not include any specific standards or requirements regarding nursing homes controlling the spread of infectious disease. Accordingly, it found the handbook could not provide a basis to bring Mr. Hitesman’s objections within the scope of CEPA’s protection.

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Recently, the New Jersey Supreme Court ruled that private claims under the New Jersey Civil Rights Act (NJCRA) are limited to claims against individuals who were acting “under color” of state law. In other words, you can bring a private lawsuit under the NJCRA, but only against someone who was acting in his or her capacity as an employee or agent of the state or local government.

Bitters and infusions on bar counter with blurred bottles in bacThe case was brought by Maryann Cottrell, a resident of Glassboro, New Jersey. Ms. Cottrell apparently made negative comments about Zagami LLC at its public liquor license renewal hearing. Zagami is a company that owns a restaurant and bar in Glassboro. The company subsequently sued Cottrell, claiming her statements at the hearing were defamatory.
Zagami’s lawsuit eventually was dismissed by the Appellate Division. It found that since the liquor license renewal hearing was a “quasi-judicial” proceeding, Ms. Cottrell’s statements at it were protected by absolute immunity, meaning she could not be sued for anything she said at the hearing.

Ms. Cottrell then sued Zagami for malicious use of process, claiming its defamation lawsuit was a Strategic Lawsuit Against Public Participation (also known as a “SLAPP suit”) since it was baseless and intended to retaliate against her for speaking out against Zagami at the hearing and to deter her from doing so again in the future. Ms. Cottrell also brought a claim under the New Jersey Civil Rights Act (NJCRA), a state law that provides remedies for certain violations of the United States and New Jersey Constitution. For more information about the NJCRA, please read our Frequently Asked Questions (FAQ) About the New Jersey Civil Rights Act.

The trial court dismissed Ms. Cottrell’s case, finding there was probable cause for Zagami to bring a defamation claim, meaning there was a good enough basis for the company to file its defamation lawsuit that Ms. Cottrell could not prove that lawsuit was brought maliciously. The lower court also dismissed Ms. Cottrell’s NJCRA claim, ruling you cannot bring a private lawsuit under the NJCRA unless the defendant was acting under color of law.

The Appellate Division reversed on both of those issues. If concluded there was no probable cause for Zagami’s defamation lawsuit, and therefore Ms. Cottrell could proceed with her malicious abuse of process claim. It also ruled that the NJCRA does permit private claims against individuals who were not acting under color of law, as long as the lawsuit alleges the plaintiff was deprived of one of his or her protected rights, in this case the right to free speech.

However, last week in Cottrell v. Zagami, LLC and a companion case, Perez v. Zagami, LLC, the New Jersey Supreme Court reversed the Appellate Division’s ruling with respect to Ms. Cottrell’s NJCRA claim. It held the NJCRA creates a private cause of action only against individuals who are acting under color of law. Accordingly, since Zagami is a private company and not a government agency, it cannot be sued under the NJCRA.

The Supreme Court noted that Ms. Cottrell still has a remedy for Zagami’s effort to deter her from publically speaking about matters of public interest at a municipal hearing. Specifically, she still can continue to pursue her malicious use of process claim.

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