Does your company conduct internal investigations? If so, you should be asking yourself these four crucial questions:
Click here to read more about these important internal investigation concerns in an article recently written by Kelly Ann Bird and published by The Metropolitan Corporate Counsel.
Introduction
In the latest chapter of the ongoing case of Quinlan v. Curtiss-Wright Corporation, the New Jersey Appellate Division has ruled that while an employer, found to have terminated an employee in violation of the New Jersey Law Against Discrimination (“the LAD”), has the burden of persuasion to establish a plaintiff’s failure to mitigate damages with respect to back pay, the employer does not have the burden of persuasion with respect to a plaintiff’s failure to mitigate future losses, including front pay. In reversing a jury award for front pay in the amount of $3,650,318 because of improper jury instructions on the front pay issue, the Appellate Division suggested a framework for proper jury instructions on front pay damages and referred the issue to the Model Civil Jury Charge Committee. The Court also reversed the jury’s punitive damages award of over $4.5 million, concluding that that award was linked to the front pay award. The Court held that a new trial was required on both the front pay issue and on punitive damages.
Background
As we previously reported in 2009 and 2010, the Quinlan case has been the subject of much judicial review in recent years. Briefly summarized, the plaintiff, Joyce Quinlan, was employed as the Executive Director of Human Resources at Curtiss-Wright Corporation. She alleged that Curtiss-Wright discriminated against her in violation of the LAD by giving a promotion she sought to a man who was then made her supervisor. To support her case, Quinlan, due to her position in the Human Resources department, was able to collect over 1,800 pages of confidential documents, including a copy of her supervisor’s prior performance appraisal. Rather than produce this document in the course of discovery during the lawsuit, Quinlan’s counsel surprised the supervisor with it at his deposition. Shortly thereafter, Curtiss-Wright terminated Quinlan’s employment for breach of company policies and theft of company property. Quinlan then added a retaliation claim to her pending lawsuit, claiming that Curtiss-Wright had terminated her in retaliation for engaging in “protected activity” in prosecuting her discrimination claim.
Jury Award
At the conclusion of the case, the jury awarded Quinlan an aggregate sum of $4,565,479 in compensatory damages, including $3,650,318 in future (i.e., post-trial) economic losses, including front pay. In addition, the jury awarded Quinlan $4,565,479 in punitive damages, a figure that matched the aggregate award for compensatory damages. After appeals of other discrete issues were ultimately decided by the New Jersey Supreme Court, the case was remanded to the Appellate Division for a determination of issues not considered by the Supreme Court, including the propriety of the front pay award and the adequacy of the jury instructions regarding same.
Appellate Division Decision
The Appellate Division described “front pay” as “a concept that attempts to project and measure the on-going economic harm, continuing after the final day of trial, that may be experienced by a plaintiff who has been wrongfully discharged in violation of anti-discrimination laws.” The Court observed that front pay “generally compensates for the immediate loss of the position until the position would have ended or the employee would have left the company.” Importantly, however, the Court noted that “the purpose of front pay . . . is to ensure that a person who has been discriminated against . . . is made whole, not to guarantee every claimant who cannot mitigate damages by finding comparable work an annuity to age 70.”
The Appellate Division concluded that the trial court’s jury instructions on front pay “erroneously imposed a burden upon defendant to prove that plaintiff would not mitigate her damages in the future after the [conclusion of the trial].” Specifically, the flawed jury instructions provided that defendant not only “had the burden of proving plaintiff’s failure to mitigate damages in the past with respect to back pay, but also bore that same burden to prove that she will fail to mitigate her future losses with respect to front pay.” The Court noted that such an instruction “placed the onus on defendant to prove something that is inherently very difficult to prove - that plaintiff will fail to mitigate future damages that have not yet even occurred,” especially given the fact that such a finding largely turns upon a plaintiff’s own post-trial decisions and matters substantially within her own volition and control. Finding that such an obligation would impose a burden on the defendant-employer “in the prohibited realm of speculation,” the front pay award was vacated and the issue was remanded to the trial court. Likewise, because the front pay issue was “inextricably intertwined with the quantum of punitive damages awarded” (which mirrored the total compensatory damages), the Court also vacated the award of punitive damages.
Recommendations for Jury Instructions
Having determined that it is improper to adopt an explicit jury instruction that places upon either party an evidential burden of proving, or disproving, a plaintiff’s post-trial fulfillment of her duty to mitigate damages, the Appellate Division adopted the preferable approach of requiring the plaintiff to prove the likely duration of her future lost income, without expressing that evidential burden in terms of “mitigation.” In this regard, the Court ruled that both sides were entitled, but not required, to present statistical and “employability” evidence through expert witnesses. The Court recommended that the jury “ further be advised that in assessing such a front pay claim, they should keep in mind that plaintiff will bear an on-going obligation to reasonably mitigate her damages in terms of her future conduct.” Additionally, the trial court’s instructions also must adequately inform the jury that the “plaintiff bears the burden of proving that the damages she claims are either permanent or will last for a reasonably determinable time.” The Appellate Division referred the issue to the Model Civil Jury Charge Committee to develop a recommended charge for such cases to assist the bench and the bar.
Conclusion
As the Quinlan Court recognized, a “plaintiff may choose to maximize her future earnings after trial, or she may choose not to do so.” As such, the plaintiff-employee - and not the defendant-employer - is ultimately responsible for proving that her compensable injuries are permanent or will endure into the future for a reasonably likely time. It would be inherently unfair to require a defendant-employer to hypothesize as to what potential jobs will be obtainable in the future market and to further demonstrate to the jury that plaintiff will not pursue them. Moreover, as the Court noted, front pay awards are often contingent upon factors presently unknowable and subject to considerable change, such as market trends, a plaintiff’s employability, and whether plaintiff would have remained in the same position if not for the discrimination. A proper assessment of front pay damages thus requires a careful balancing of these considerations, and, when confronted with front pay claims, employers should seriously consider retaining statistical and employability experts who can address the relevant factors as articulated by the Court.
For additional details regarding the decision in Quinlan, or to discuss any of your company’s employment-related needs, contact an attorney in the Gibbons Employment & Labor Law Department.
Michael J. Riccobono is an Associate in the Gibbons Employment & Labor Law Department.
Joining a growing number of jurisdictions, including the Third and Ninth Circuit Courts of Appeal, the Court of Appeals for the Second Circuit, covering the states of New York, Connecticut and Vermont, has held that under certain circumstances, an employer may be required to assist disabled employees with their commute to work as a reasonable accommodation under both the Americans with Disabilities Act (“ADA”) and the Rehabilitation Act. The Court’s decision in Nixon-Tinkelman v. N.Y. Dep’t of Health & Mental Hygiene highlights an employer’s obligation to consider reasonable accommodations requested by employees with disability-related commuting problems.
Americans with Disability Act Background
The ADA, in essence, requires covered employers to provide “reasonable accommodations to the known physical or mental limitations of an otherwise qualified individual with a disability.” Under the statute, a “qualified individual” is someone with a disability who “with or without reasonable accommodation” can perform the essential functions of a particular job. “Disability,” in turn, is defined as “a physical or mental impairment that substantially limits one or more of the major life activities of the individual.” Thus, in order to establish she is entitled to a reasonable accommodation, an individual must: (a) show that she has an impairment; (b) identify the life activity that she claims is limited by the impairment; and (c) prove that the limitation is substantial.
Factual History
The Nixon-Tinkelman Plaintiff, who suffers from a hearing impairment, cancer, heart problems, and asthma, claimed her employer discriminated against her on account of her disabilities when it failed to accommodate her commute to work. Plaintiff, who works and lives in Queens, NY, was temporarily reassigned to her employer’s Manhattan office for a period of nine months. Upon being notified of this transfer, Plaintiff requested that Defendants accommodate her disabilities by transferring her back to an office location closer to her home. Defendants denied this request and Plaintiff thereafter filed suit under the ADA and the Rehabilitation Act. Finding that “commuting falls outside the scope of [p]laintiff’s job, and is thereby not within the province of an employer’s obligations under the ADA and the Rehabilitation Act,” the District Court for the Southern District of New York granted summary judgment in favor of the Defendant.
Second Circuit Opinion
On appeal, the Second Circuit, held that the district court erred in concluding that an employer had no obligation to assist in an employee’s commute, stating that “there is nothing inherently unreasonable . . . in requiring an employer to furnish an otherwise qualified disabled employee with assistance related to her ability to get to work.” As a result, the Second Circuit remanded the case to the district court to consider “whether it would have been reasonable for defendants to provide assistance related to Tinkelman’s ability to get to work.” The Court specifically focused on the fact that Plaintiff had worked for many years in a more suitable location and, as a result, the district court “should have considered whether defendants could have reasonably accommodated her needs simply by transferring her back to Queens or another closer location, allowing her to work from home, or providing a car or parking permit.”
Nonetheless, because “determining whether a particular commuting accommodation is reasonable normally involves a fact-specific inquiry,” the Second Circuit offered a non-exclusive list of factors to assist the district court’s determination of reasonableness on remand:
Implications for Employers
The Nixon-Tinkelman decision provides guidance to employers on how to evaluate and handle reasonable accommodation requests related to an employee’s commute. As noted above, the decision is also in line with a number of decisions from other jurisdictions determining whether an employer is required to accommodate commute-related requests. For example, in Colwell v. Rite Aid Corp, the Third Circuit Court of Appeals, covering the states of New Jersey, Pennsylvania, and Delaware, held that changing an employee’s work schedule “in order to alleviate her disability-related difficulties in getting to work is a type of accommodation that the ADA contemplates.” The plaintiff in Colwell requested she only be scheduled to work day shifts due to a vision-impairment that affected her ability to operate a vehicle at night. Similarly, the Ninth Circuit Court of Appeals, in Livingston v. Fred Meyer Stores, Inc., found that the plaintiff’s difficulties in commuting to work due to a vision-impairment required accommodation by the employer, because “seeing” was a major life activity.
The opinions discussed above create a number of issues to which employers must be sensitive. First, the cases make clear that reasonable accommodations are not simply limited to an employee’s on-site work performance, but may, under the appropriate circumstances, also include a duty to accommodate an employee’s limitations in commuting to and from their places of employment. Second, employers should remember that while it is “generally the responsibility of the individual with a disability to inform the employer that an accommodation is needed,” employers are obligated to engage in good faith in the interactive process with respect to all disability-related accommodation requests. Thus, although employers are not obligated to provide accommodations that would cause them “undue hardship,” requests for reasonable accommodations relating to commuting issues must be considered on a case-by-case basis and should not be rejected out of hand.
To discuss any of your company’s employment-related needs, contact any attorney in the Gibbons Employment & Labor Law Department.
Michael J. Riccobono is an Associate in the Gibbons Employment & Labor Law Department.
The New Jersey Appellate Division recently held in Rusak v. Ryan Automotive, LLC that a plaintiff was entitled to further proceedings on her punitive damages claim following a jury verdict in her favor on her hostile work environment and retaliation claims even though the jury did not award her emotional distress damages and rejected her separate intentional infliction of emotional distress claim. Although the case involved unique circumstances that are unlikely to be present in future matters, the decision serves as a reminder that the absence of an emotional distress award does not preclude further proceedings on punitive damages.
Rusak, a sales representative for a BMW dealership, presented evidence that the general manager of the dealership screamed and cursed at her, called her a “dumb… stupid blonde,” asked her if she was menstruating and told her and another female employee graphic stories about his sexual exploits. In addition, when Rusak complained to the general manager about the inappropriate behavior of a male co-employee, the general manager ignored her complaint and told others of his plans to fire her. The jury found that the general manager had created a hostile work environment and retaliated against Rusak and awarded wage loss damages only.
Two specific jury interrogatories on the verdict sheet addressed Rusak’s alleged emotional distress, asking the jury whether “the acts of the [d]efendants constitute such willful, wanton and reckless conduct that you find for [plaintiff] on the legal theory of intentional infliction of emotional distress” and whether the plaintiff should be “awarded damages to compensate for her emotional pain and mental anguish.” In both instances, the jury answered “No,” thus denying Rusak’s intentional infliction of emotional distress claim and denying Rusak damages for emotional distress on the other claims for which the jury found liability. The trial judge viewed the jury’s response to these questions as an indication that the jury did not intend to award punitive damages and did not allow further proceedings on the punitive damages claim.
In a February 8, 2011 decision by Judges Graves, Messano and Waugh, the Appellate Division initially held that “[o]nce the jury awarded plaintiff compensatory damages as a result of defendants’ violation of the LAD, the particular conduct of defendants in this case warranted submission of the punitive damages claim to the jury.” Next, the court considered whether the jury’s response to the interrogatories on the verdict altered its initial impression. The Court noted that the jury interrogatory concerning the intentional infliction of emotional distress claim incorporated language that was not even an essential element of that cause of action. Defendants argued that the language, which was more closely akin to the standard for an award of punitive damages under the Punitive Damages Act (the PDA), N.J.S.A. § 2A:15-5.9 to -5.17, was intended as a “bridge question” and was “designed to incorporate within its terms the requisite state of mind necessary to support an award of punitive damages.” According to Defendants, “the jury’s negative answer to [the question] means that plaintiff had failed to prove defendants had acted with ‘actual malice or. . .wanton and willful disregard’ of potential harm so as to support any award of punitive damages.” The Court rejected this argument, finding it both “confusing and unpersuasive” and holding that the jury’s response to the interrogatory “cannot be interpreted as a factual finding that defendants did not act with the requisite mental state to support an award under the PDA.”
At first glance, this case appeared more significant than is actually the case. The unique circumstances presented, and particularly the poorly worded jury interrogatory, clearly guided the outcome, and it seems unlikely that the same set of facts would occur in future matters. While the case stands for the proposition that the absence of an emotional distress award does not in and of itself preclude further proceedings on punitive damages, it remains within the province of the Court to dismiss a claim for punitive damages based on the facts presented at trial, even when the jury finds liability. From the Court’s decision, it appears that this has always been the law and remains the law today.
Susan L. Nardone is a Director in the Gibbons Employment Law Department.
Though the decision has received a great deal of attention because of the controversy, as played out in the separate opinions of Chief Justice Rabner and Associate Justices Rivera-Soto and Hoens, over whether the temporary appointment to the New Jersey Supreme Court of Judge Stern of the Appellate Division is constitutional, the recently decided case of Henry v. New Jersey Department of Human Services, is of special interest to employers, as it appears to expand the circumstances under which a plaintiff can invoke the equitable device known as the “discovery rule” to toll the 2-year statute of limitations applicable to claims under the Law Against Discrimination (LAD). In Henry, the Court, by a vote of 5-1 with one abstention, affirmed the Appellate Division’s holding dismissing plaintiff’s retaliation claim but reversed the Appellate Division’s dismissal of plaintiff’s discrimination claim. The Court remanded the discrimination claim for the trial court to conduct a hearing to ascertain whether plaintiff could not have reasonably discovered she had claim within 2 years of the accrual of her cause of action.
Background
Plaintiff, Lula Henry, an African-American, holding a Master of Science Degree in Nursing, secured a full-time entry-level nursing position at the Trenton State Psychiatric Hospital (the Hospital) in April 2004. Upon accepting the position, she developed a concern that the Hospital was engaging in discriminatory hiring practices, as the only other two women who possessed a Master’s Degree, both of whom were Caucasian, were employed in more advanced positions. A member of the Hospital’s human resources department angrily advised plaintiff, however, that employees were only eligible for advancement after successfully completing one full-year of employment. During the Summer of 2004, plaintiff made a written request seeking that she be reclassified based upon her qualifications and sent a copy of her letter to a State Assemblyman. Afterwards, a human resources manager nastily told her that she had stood a chance of being reclassified "until he received a letter from some bureaucrat downtown." In response to this conversation, plaintiff resigned and later secured employment elsewhere.
In the Spring of 2006, plaintiff received information from a union representative that confirmed many of the suspicions she had when she was hired. Specifically, plaintiff learned that a Nigerian nurse had contested the placement of a less qualified Caucasian nurse and also learned that a Caucasian nurse with credentials less extensive than her own was hired into a non-entry level position.
Plaintiff filed a complaint against the Hospital on July 24, 2007, claiming it had unlawfully discriminated against her in its hiring practices and had retaliated against her when she complained. The trial court granted the Hospital’s’ motion for summary judgment on both of these claims. The Appellate Division affirmed.
Supreme Court’s Decision
The Court began its analysis by discussing the history of the discovery rule. First employed in the medical malpractice context, the discovery rule has been extended to a variety of claims, including those brought under the LAD. The Court explained that the discovery rule triggers the tolling of the applicable statute of limitations when it is determined that a reasonable person employing ordinary diligence would be unaware that they have a valid cause of action against another party.
As to plaintiff’s retaliation claim, the Court sought guidance from its recent decision in, Roa v. Roa, holding that the continuing violation theory does not permit the aggregation of discrete discriminatory acts for the purpose of reviving untimely filed claims. See generally 200 N.J. 555 (2010). Here, the Court found that plaintiff clearly knew or should have known that she was the subject of retaliation within the 2-year limitations period, since while still employed she was in essence told that she would have been reclassified had she not complained. Thus, the Court affirmed the dismissal of the retaliation claim.
The Court, however, considered the analysis of plaintiff’s discrimination claim to be more complex. Though the Court recognized that plaintiff did have an initial concern of discrimination upon acceptance of the entry-level position with the Hospital, the Court found most significant the fact that a member of the human resources department at the Hospital had given her nondiscriminatory reasons for not advancing her. Her reliance on these statements, in the eyes of the Court, may have rendered Plaintiff “unaware” for purposes of the discovery rule that she had a cause of action until she learned, more than 2 years later, that similar discriminatory practices had occurred at the Hospital. Thus the Court reversed the dismissal of plaintiff’s discrimination claim and remanded the case to the trial court in order to conduct a hearing at which plaintiff “is entitled to assert that she had no "reasonable suspicion" of racial discrimination, even by the exercise of reasonable diligence, until 2006 . . . .”
Conclusion
The Court’s decision appears to have expanded the basis upon which the discovery rule may be invoked to toll the statute of limitations. The facts reveal that plaintiff clearly was at least minimally “aware” of the presence of discriminatory treatment. Although the Court did not directly hold that the employer was stopped from asserting the statute of limitations, it appears to have incorporated equitable tolling principles into the discovery rule by holding that plaintiff’s reliance on her employer’s explanation may have rendered her “unaware” of her claim. We will keep an eye on further developments in the case.
Peace of mind. That is what the two-year statute of limitations period applicable to claims filed under the New Jersey Law Against Discrimination (“LAD”) afforded employers. With respect to discriminatory compensation claims, however, the New Jersey Supreme Court’s decision in Alexander v. Seton Hall University has destroyed that peace of mind, holding that each individual paycheck effecting a discriminatory compensation decision constitutes an actionable unlawful employment practice. No longer is the two-year statute of limitations measured from the date of the compensation decision.
At issue before the Court in Alexander were the claims of three female professors who alleged that they were paid unequal wages on the basis of gender and age in violation of the LAD. The Appellate Division had affirmed the trial court’s decision that a portion of the professors’ claims were untimely because the compensation decisions at issue were made more than two years before the professors filed their complaint and thus those claims were barred by the two-year statute of limitations applicable to LAD claims. In their appeal to the New Jersey Supreme Court, the professors argued that no portion of their pay claims were time-barred and that “each paycheck that perpetuates a discriminatory wage continues the original LAD violation and sweeps in all prior and current discriminatory, disparate paychecks.” The University, on the other hand, argued that the statute of limitations period commenced as of the date that the allegedly discriminatory compensation decision was made. The New Jersey Supreme Court did not accept the professors’ “continuing violation” argument in its entirety but did hold that each paycheck received by an employee serves to “restart” the two-year limitations period. Logically then, a plaintiff should be able to assert claims for discriminatory compensation only with regard to compensation received within two years of the filing of plaintiff’s complaint - and the Supreme Court so held.
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