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New Jersey Law Against Discrimination

During the midst of the Me-Too Movement, the New Jersey Law Against Discrimination (“NJLAD”) was amended to make it easier for victims of harassment, retaliation, and discrimination to avoid onerous confidentiality restrictions that prevented those employees from discussing such claims after those matters were resolved with their employer. Specifically, that amendment, N.J.S.A. 10:5-12.8(a), provides that “[a] provision in any employment contract or settlement agreement which has the purpose or effect of concealing the details relating to a claim of discrimination, retaliation, or harassment (hereinafter referred to as a non-disclosure provision) shall be deemed against public policy and unenforceable against a current or former employee.” An open issue that was left unaddressed in the law was whether a contractual non-disparagement provision that typically precludes the employee from saying anything derogatory or damaging about an employer was covered by this statutory restriction. On May 7, 2024, the New Jersey Supreme Court finally provided its answer to this important open statutory issue.

In Savage v. Township of Neptune, 257 N.J. 204 (2024), the New Jersey Supreme Court was asked to determine whether a broad contractual non-disparagement clause in a settlement agreement between the Defendant employer and Plaintiff former employee fell within the statutory restrictions of N.J.S.A. 10:5-12.8(a). The Township of Neptune sought to enforce a non-disparagement provision in a settlement agreement between it and the Plaintiff, who during a television news program, discussed her settled case and made unflattering statements about those she believed had harassed her. The trial court granted the Township’s motion to enforce the provision, finding that the NJLAD amendment barred only non-disclosure and confidentiality agreements, and Plaintiff here had instead violated an enforceable non-disparagement provision. This decision was then upheld by the appellate court which similarly determined that a non-disparagement clause was nevertheless enforceable despite N.J.S.A. 10:5-12.8(a).   

Disagreeing with the lower courts that previously considered the issue, the New Jersey Supreme Court ruled that any contractual provision that has the effect of stopping an employee or former employee from being able to discuss or disclose the factual circumstances or details of a harassment, discrimination or retaliation claim violates N.J.S.A. 10:5-12.8(a) and is thus not enforceable as it is contrary to public policy. Applying that standard to the non-disparagement provision before it, the Court ruled that as written it was violative of N.J.S.A. 10:5-12.8(a) and could not be enforced against Plaintiff because its effect was to silence the former employee’s ability to discuss her past harassment and discrimination claims against Defendant.

Significantly for employers, while the Savage case may have ultimately been a win for the Plaintiff, it could have been far worse. Thankfully the Court’s ruling did not go so far as to categorically ban all non-disparagement provisions. Instead, the decision still leaves open the possibility of enforcement of more narrowly tailored non-disparagement provisions that do not impair an employee’s ability to address the details relating to harassment, discrimination, and retaliation claims. Thus, a properly drafted contractual non-disparagement clause can still be enforceable and beneficial for the employer, as the employer may continue to prevent the making of defamatory and disparaging comments regarding other unrelated subjects and topics that do not fall within the express restrictions of N.J.S.A. 10:5-12.8(a).

Accordingly, in light of the Savage decision, employers should immediately commence a review of all their employment contracts and severance agreements and bring any non-disparagement provisions in line with the new limitations on enforceability recently announced by the New Jersey Supreme Court.           

By: Gitika Kapoor, Law Clerk
Editor: Sanmathi (Sanu) Dev, Esq.

On June 8, 2021, the Supreme Court of New Jersey held in Richter v. Oakland Board of Education that an employee is not required to establish adverse employment action such as demotion or termination in a failure to accommodate disability claim brought against an employer under the New Jersey Law Against Discrimination (“NJLAD”).  In addition, the Court considered whether the plaintiff’s claim was barred by the exclusive remedy provision of the Workers’ Compensation Act (“WCA”). The Court held that the NJLAD and WCA are not in tension with each other, and the WCA did not bar the plaintiff’s lawsuit.

In Richter, a teacher who suffered from Type 1 diabetes was assigned a late lunch period and experienced a hypoglycemic event in the classroom.  As a result, she suffered a seizure, lost consciousness, and struck her head on a lab table and the floor, causing excessive bleeding. She filed a workers’ compensation claim and received compensation for her medical bills and disability benefits. She later brought a NJLAD action asserting a failure to accommodate disability claim against the Oakland Board of Education. In her complaint, she alleged that, despite repeated requests to alter her schedule, the principal failed to accommodate her request to be assigned an earlier lunch time. The trial court granted summary judgment in favor of the Board, which the Appellate Division reversed.

On the NJLAD issue, the New Jersey Supreme Court held that a failure to accommodate claim may arise from an “employer’s inaction, silence or inadequate response to reasonable accommodation request,” and that causing harm to the employee through an adverse employment action is not a necessary element of the claim. The Court recognized that a failure to accommodate is itself an actionable harm, because the wrongful act is the employer’s failure to fulfill its duties under the law. Importantly, the Court noted that a lack of demonstrable consequences in the form of adverse employment action may affect damages. 

Regarding the WCA, the Court held that the statute’s exclusive remedy provision did not bar the plaintiff’s NJLAD claim, reasoning that the legislature intended for the NJLAD to supplement other legal remedies. According to the Court, the NJLAD and WCA both aim to protect workers in the workplace and can function harmoniously, without conflicting with each other. Therefore, the WCA did not bar the plaintiff’s lawsuit.

Client: KIPP: Cooper Norcross Academy Charter School

Court: New Jersey Superior Court, Law Division, Camden County

Brief Attorney:  Cameron R. Morgan, Esq.

**Results may vary depending on your particular facts and legal circumstances**

In a disparate treatment theory case brought under the New Jersey Law Against Discrimination (NJLAD), a teacher/learning specialist at a charter school alleged gender, pregnancy, and disability discrimination after she was non-renewed from her position after taking an FMLA leave and extended disability leave due to her high-risk pregnancy.  The teacher claimed that her employment contract was non-renewed based on her intention to start a family within the first few years of her employment.

In advance of trial, the court granted summary judgment on behalf of the Defendant charter school and dismissed the claims, finding that (1) the Plaintiff failed to set forth sufficient evidence from which a reasonable jury could conclude she had satisfied the prima facie elements of discriminatory intent on the part of the school underlying the non-renewal, or that she was performing the functions of her position at a level that met the school’s legitimate expectations; and (2) the charter school had numerous legitimate, non-discriminatory reasons for non-renewing her employment, including below proficient evaluation scores, improper use of “time-outs,” and poor classroom management skills.

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