New Jersey’s comprehensive new equal pay law, the Diane B. Allen Equal Pay Act (the “Act”), took effect last month. The law amends the New Jersey Law Against Discrimination (“NJLAD”) by making it a prohibited employment practice for an employer to compensate an employee who is a member of a “protected class” less than the amount paid to employees who are not members of that protected class for “substantially similar work, when viewed as a composite of skill, effort, and responsibility.” Employers can prove a compensation differential is lawful by showing it is due to a seniority system, merit system, or by satisfying several factors including that the differential is based on legitimate, bona fide factors other than the employee’s membership in a protected class, and that the factors supporting the differential are job-related and based on a legitimate business necessity. The Act extends the NJLAD’s two-year statute of limitations to a six-year statute of limitations for wage discrimination claims.
Governor Phil Murphy recently made good on his campaign promise to make equal pay a top priority in New Jersey. On April 24, 2018, Governor Murphy signed into law the Diane B. Allen Equal Pay Act (the “Act”), which amends the New Jersey Law Against Discrimination (“NJLAD”). The Act was passed by the New Jersey Legislature on March 27, 2018, and takes effect on July 1, 2018.
The Act is being heralded as one of the most expansive equal pay laws in the country, and impacts hiring practices, compensation practices, employee arbitration agreements and how HR must respond to employee demands for information regarding their co-workers’ compensation.
Continue reading “New Jersey Enacts Comprehensive Equal Pay Law – What Employers Need to Know”
The New Jersey Legislature recently passed a bill amending the New Jersey Law Against Discrimination (“NJLAD”) to include breastfeeding as a protected category. The law took effect immediately after it was signed into law by former Governor Christie on January 8, 2018.
Breastfeeding Protections under the NJLAD
Under the amended law, upon request, employers must provide nursing mothers with reasonable breaks during the workday and a suitable private location (other than a toilet stall) close to the employee’s work area to express breast milk for her infant child as a reasonable accommodation, unless doing so would cause an undue hardship on the employer’s business operations. In determining whether an accommodation would impose an undue hardship, the following factors are to be considered:
Referred to by some courts as an “awkward theory” of liability, employers and supervisors should be aware that courts in New Jersey continue to recognize the viability of individual liability claims under the “aiding and abetting” provision of the New Jersey Law Against Discrimination, N.J.S.A. §10:5-12(e).
Personal Liability for Supervisors: Title VII vs. NJLAD
Unlike Title VII of the federal Civil Rights Act, which does not provide for individual employee liability, New Jersey courts have held that in addition to “employers” being liable under NJLAD, supervisors can be personally liable for their illegal conduct under an “aiding and abetting” theory. The New Jersey Supreme Court recently clarified the expansive definition of “supervisor” for purposes of the NJLAD as an employee who is (1) authorized to undertake tangible employment decisions affecting the plaintiff, or (2) authorized by the employer to direct the plaintiff’s day-to-day work activities. Aguas v. New Jersey, 220 N.J. 494, 529 (2015).
To hold a supervisor liable as an “aider and abetter” under the NJLAD, a plaintiff must show that the individual (1) performed a wrongful act that caused an injury; (2) was generally aware of his or her role as part of an overall illegal activity at the time that he or she provided the assistance; and (3) knowingly and substantially assisted in the principal violation. Tarr v. Ciasulli, 181 N.J. 70, 83084 (2004). Aiding and abetting requires “active and purposeful conduct.” Cicchetti v. Morris County Sheriff’s Office, 194 N.J. 563, 595 (2008).
What Makes this Aiding and Abetting Theory so “Awkward”?
Courts applying New Jersey law have yet to follow a uniform rule in situations where the plaintiff alleges that a supervisor aided and abetted the “employer” in violating the NJLAD based on the supervisor’s own conduct (i.e., as the sole actor engaged in the wrongful conduct). In other words, what happens when the supervisor is the only person alleged to have engaged in the wrongful conduct? Two distinct lines of cases have developed in this area of the law – one finding supervisory employees can be personally liable for aiding and abetting their own/the employer’s wrongful conduct (e.g., Hurley v. Atlantic City Police Dep’t, 174 F.3d 95 (3d Cir. 1999), and another refusing to impose individual liability (e.g., Newsome v. Admin. Office of the Courts of N.J., 103 F. Supp. 2d 807 (D.N.J. 2000). See Aiding and Abetting Your Own Conduct, New Jersey Law Journal, Volume 209 (July 16, 2012), Employment Counselor, Number 241 (Sept. 2010).
A string of recent decisions by New Jersey state and federal courts suggest that this “awkward” theory is here to stay. For example, in Yobe v. Renaissance Electric, Inc., 2016 WL 614425 (D.N.J. Feb. 16, 2016), the court denied a motion to dismiss the plaintiff’s NJLAD disability retaliation claims against his former supervisor, who was the only person alleged to have engaged in the retaliatory conduct. The defendant argued that the plaintiff’s claim failed as a matter of law because a supervisor cannot “aid and abet” his own conduct. Citing to the Third Circuit’s “prediction” in Hurley that the New Jersey Supreme Court would hold a supervisor personally liable under NJLAD, and an unpublished, non-precedential decision by the New Jersey Appellate Division in Rowan v. Hartford Plaza Ltd., 2013 WL 1350095 (App. Div. April. 5, 2013), the court in Yobe concluded that “[w]hile it is concededly an ‘awkward theory’ to hold an individual liable for aiding and abetting his own conduct, it would thwart the NJLAD’s broad and remedial purpose, and make little sense, to construe it as permitting ‘individual liability for a supervisor who encourages or facilitates another employee’s harassing conduct, while precluding individual liability for the supervisor based on his or her own discriminatory or harassing conduct.’”
Impact on Employers and Individual Supervisors
In discrimination, hostile work environment and retaliation cases brought under the NJLAD, it is common for a plaintiff to name his or her former supervisor as an individual defendant, particularly if the supervisor is the person who made the decision to take an adverse employment action against the plaintiff. Naming the supervisor, particularly a high-level manager, might be viewed by the plaintiff as a tactical move to encourage an early settlement by driving a wedge between the employer’s interest in defending its business decision and the supervisor’s reputational or financial impact concerns. Absent a showing of fraudulent joinder, a plaintiff’s naming of his or her supervisor as a defendant might prevent the employer from removing the action to federal court based on complete diversity of citizenship. In addition, legal fees could increase if separate legal representation for the employer and the supervisor is required. These important issues should be considered and discussed with counsel at the outset of the case. Because the NJLAD does not provide for individual liability for aiding and abetting if the employer is not found liable, the best defense is a unified one between the employer and the individual supervisor.
Earlier this week, the New Jersey General Assembly passed a bill that would amend the New Jersey Law Against Discrimination (“NJLAD”) to address specifically pay differentials among employees of different sexes who perform “substantially similar” work. The amendment, which the state Senate passed last month, will now be delivered to the Governor for consideration.
As the NJLAD exists now, an employee can bring a pay-related claim only by alleging that the differential amounts to sex discrimination and satisfying a comparatively higher standard. If the bill is signed into law, New Jersey would follow in the footsteps of other states like New York and California, which have recently updated their discrimination laws to provide a separate cause of action specifically for unequal pay.
The bill, if enacted into law, would severely limit the circumstances under which an employer can pay male and female employees different amounts for “substantially similar” work. An employer would be permitted to do so if it can demonstrate that it is utilizing a seniority (pay based on tenure) or merit (pay based on achieving certain goals) system. Alternatively, the employer would need to demonstrate that each of the following factors exists:
• The differential is based on one or more legitimate, bona fide factors other than sex, such as training, education or experience, or the quantity or quality of production;
• The factor or factors do not perpetuate a sex-based differential in compensation;
• Each of the factors is applied reasonably;
• One or more of the factors account for the entire wage differential; and
• The factors are job-related with respect to the position in question and based on a legitimate business necessity, and there are no alternative business practices that would serve the same business purpose without producing the wage differential.
If enacted, the New Jersey bill would also significantly increase potential employer exposure, in that the recovery period would be extended to pick up the entire time period when the pay differential existed.
With the passing of this bill by both houses, and with laws specifically targeting gender-based pay differences on the rise generally, employers would be wise to look at their employees’ titles and job descriptions to identify “substantially similar” positions and any pay differentials among the employees in those positions. Where such differences exist, employers will want to explore the reason for those differences and whether changes need to be made. If an employer has an established seniority or merit-based system on which it intends to rely, it is important that the system be set forth in detail and made available to all employees, so that there is no question as to its existence and applicability later.
Update 1/23/14 – On Wednesday, January 22, 2014, Governor Christie signed S2995 into law. LaborSphere’s original post on the legislation appears below.
New Jersey is on the precipice of expanding anti-discrimination protections to both pregnant women and new mothers and those recovering from childbirth. The State Senate and now the State Assembly have passed identical measures with only one dissenting vote in either legislative body. The expansive legislation now awaits the signature of Governor Chris Christie in order to become law.
Amendments to New Jersey Law Against Discrimination
In order to address the perceived vulnerability of pregnant women in the workplace as well as to foster the goal of healthier pregnancies and recovery from childbirth, the legislation passed by New Jersey’s legislature expands the anti-discrimination and anti-retaliation protections of New Jersey’s Law Against Discrimination (“NJLAD”). Should it pass, both pregnant women but also those who have recently given birth or have medical conditions related to pregnancy will be statutorily protected against disparate treatment and retaliation by employers, labor organizations, landlords, lending institutions as well as an array of other entities that offer public accommodations.
Further, not only does the pending legislation add “pregnancy” to the array of protected categories covered by the NJLAD. It also specifically requires employers to provide “reasonable accommodations,” such as bathroom breaks, breaks for increased water intake, periodic rest, assistance with manual labor, job restructuring, modified work schedules and temporary transfers to less strenuous or hazardous work.
The legislation implied but does not specifically state that any such requested accommodations will likely need to be based on the advice of a physician. As such, it appears that pregnant women and those who have recently given birth cannot merely demand that an accommodation is “reasonable” and necessary absent some input from her physician.
Further, employers are not obligated to agree to any requested accommodation, even if it is supported by a physician’s recommendation, if such an accommodation would impose an “undue burden” as defined by the statute. The proposed legislation provides specific factors to be utilized in determining whether an accommodation would impose undue hardship on the operation of an employer’s business. These include:
- overall size of the employer’ business with respect to the number of employees;
- number and type of facilities;
- size of budget;
- the type of the employer’s operations, including the composition and structure of the employer’s workforce;
- the nature and cost of the accommodation needed, taking into consideration the availability of tax credits, tax deductions and outside funding; and
- the extent to which the accommodation would involve waiver of an essential requirement of a job as opposed to a tangential or non-business necessity requirement.
New Protection To Employees Seeking Information About Claims
Perhaps the start of a new trend, among the proposed amendments to the NJLAD is also a provision that protects any employee against reprisals by employers for asking coworkers or former coworkers for information that is part of an investigation or in furtherance of a possible claim under the NJLAD. Such information may include requests for data regarding pay, compensation, bonuses or benefits. Significantly, this new protection extends beyond pregnant women and those who have recently given birth.
Impact of Amendments
If enacted, the amendments to the NJLAD would override the New Jersey Supreme Court’s 2005 ruling in Gerety v. Atlantic City Hilton Casino Resort, 184 N.J. 391 (2005). In that case, New Jersey’s highest court held that the NJLAD does not protect against the firing of a female worker who exceeded the leave available under state and federal as well as the defendant-employer’s policy. Under the proposed amendments, it is likely that the accommodations requested in the Gerety case, by a plaintiff who had a difficult pregnancy with twins, would be considered reasonable and covered under the NJLAD.
More broadly, while the federal Family Medical Leave Act and New Jersey Family Leave Act each allow for a maximum of twelve weeks of pregnancy-related leave, under the proposed amendments, the amount of leave available to a woman who is pregnant or recovering from childbirth is not as clearly defined. To the extent a women seeks an accommodation – including additional leave or a reduced work schedule – because of pregnancy and childbirth-related conditions, an employer has, at the very least, an obligation to review and consider such requests.
Should the proposed amendments to the NJLAD be passed, we recommend a review of leave policies as well as training for managers to identify requests for accommodations. Each request for accommodation must be considered carefully and should it appear to impose an undue burden, then the statutorily defined factors must be taken into account.