Sexual Harassment Lawsuit Reinstated by New Jersey Appellate Court

One potential defense an employer has in a sexual harassment case is that the employee unreasonably failed to make use of the employer’s anti-harassment policy.  A recent New Jersey Appellate Division opinion highlights the fact that this defense does not apply if the harassment led to an adverse employment action, such as the employee being fired, demoted, or suspended without pay.

Supervisor sexually harassing an employeeRamona McBride worked as a sales trainee for a car dealership, Foulke Management Corp., dba Atlantic Jeep Chrysler Fiat.  She alleges her immediate supervisor, sales manager Jack Dellafave, made sexual advances toward her and fired her because she rejected his advances.

The harassment started with Mr. Dellafave sending Ms. McBride text messages in which he told her that he was “attracted” to her, invited her to his hotel room, and offered to pay for her cab ride to his hotel.  Ms. McBride declined each of those offers.

Mr. Dellafave subsequently asked Ms. McBride why she had rejected his offers to hang out with him in private.  Ms. McBride, who understood Mr. Dellafave to be asking her to have sex with him, once again turned Mr. Dellafave down.  In response, Mr. Dellafave told Ms. McBride to “clock out” and to “leave and don’t come back.”

Later that day, Ms. McBride told Foulke’s general manager, Michael McErlean, what had happened.  The following day, Mr. McErlean told Ms. McBride she was not fired.  After Ms. McBride submitted copies of the text messages she had received from Mr. Dellafave, Foulke concluded that he had sexually harassed Ms. McBride, and fired him.  However, Ms. McBride chose not to return to work.

Ms. McBride filed a lawsuit against Foulke in which she is seeking to hold the company liable for Mr. Dellafave’s sexually harassing and retaliating against her, in violation of the New Jersey Law Against Discrimination (“LAD”).

Foulke eventually filed a motion for summary judgment in which it sought to have the case dismissed.  It argued it could not be held responsible for Mr. Dellafave’s sexual harassment because Ms. McBride never reported the harassment to the company, as required by the company’s anti-harassment policy.  I discussed that affirmative defense in a previous article: Importance of Reporting Sexual Harassment Reinforced by New Jersey Supreme Court.  Under it, an employer can avoid being held liable for harassment if it had an effective anti-harassment policy of which the employee “unreasonably failed to take advantage.”  However, that defense does not apply if the harassment culminated in an adverse employment action.

In Ms. McBride’s case, the trial court concluded that because Mr. Dellafave did not have the authority to fire Ms. McBride, and Foulke quickly told her that she was not fired, she had not suffered an adverse employment action.  Since Ms. McBride never reported Mr. Dellafave’s sexual harassment pursuant to the company’s policy, the trial court concluded that the affirmative defense applied.  Accordingly, it dismissed Ms. McBride’s lawsuit.

Ms. McBride appealed.  She argued that she had suffered an adverse employment action since Mr. Dellafave had fired her, or at a minimum a jury should decide whether he had fired her.

On May 18, 2021, in McBride v. Foulke Management, Corp., the Appellate Division agreed with Ms. McBride.  It found a factual dispute as to whether Ms. McBridge suffered an adverse employment action.  It noted that an employer does not have to use the word “fired” or “terminated” to fire an employee, and recognized that a reasonable jury could find Mr. Dellafave had fired her.  In addition, it noted that Foulke stopped paying Ms. McBridge after Mr. Dellafave instructed her to clock out, which also could be an adverse employment action.  Accordingly, it remanded Ms. McBridge’s case to the trial court.

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