Today, the New Jersey Supreme Court Issued a decision in Rodriguez v. Raymours Furniture Company, Inc. This is a case of first impression and answers the question whether an employer can contractually limit the filing period for a claim under NJ’s Law Against Discrimination (LAD).
In 2007, Sergio Rodriguez applied for a job with the defendant who operates Raymour and Flanigan furniture stores. At the bottom of the application was this bolded clause:
I AGREE THAT ANY CLAIM OR LAWSUIT RELATING TO MY SERVICE WITH RAYMOUR & FLANIGAN MUST BE FILED NO MORE THAN SIX (6) MONTHS AFTER THE DATE OF THE EMPLOYMENT ACTION THAT IS THE SUBJECT OF THE CLAIM OR LAWSUIT. I WAIVE ANY STATUTE OF LIMITATIONS TO THE CONTRARY. I WAIVE TRIAL BY JURY IN ANY LITIGATION ARISING OUT OF, OR RELATING TO, MY EMPLOYMENT
WITH RAYMOUR & FLANIGAN, INCLUDING CLAIMS OF WRONGFUL OR RETALIATORY DISCIPLINE OR DISCHARGE; CLAIMS OF AGE, SEXUAL, SEXUAL ORIENTATION, RELIGIOUS, PREGNANCY OR RACIAL
DISCRIMINATION, CLAIMS UNDER TITLE VII OF THE CIVIL RIGHTS ACT, TITLE IX, AMERICANS WITH DISABILITIES ACT, AGE DISCRIMINATION IN EMPLOYMENT ACT, EMPLOYEE RETIREMENT INCOME
SECURITY ACT, FAIR LABOR STANDARDS ACT, AND ALL OTHER APPLICABLE NON-DISCRIMINATION, EMPLOYMENT OR WAGE AND HOUR STATUTES.
Rodriguez was hired, injured his knee on the job in 2010 and underwent surgery and rehabilitation. He was terminated in 2011 in what the company called a downsizing, two days before he was scheduled to return to work. Seven months after his termination, he sued the defendant, alleging in part that he was illegally terminated for actual or perceived disability. He asserted that some employees with lower seniority or distinguishing features were retained.
There is a 6 month limit for filing a LAD complaint with the NJ Division on Civil Rights (DCR). A party can withdraw a DCR complaint at any time up until the DCR makes a final determination. The LAD law provides no statute of limitations for filing a private action in Superior Court. In a 1993 case, Montells v. Haynes, 133 N.J. 282, the Court set a 2-year statute of limitations for private actions under the LAD. The Legislature has not overruled the limit set in Montells. This limitation scheme gives aggrieved parties two options to pursue. As we saw in yesterday’s post, people are free to contractually waive rights under the law so long as they understand what they are giving up.
When the defendant moved to throw out the case because the filing was a month later than agreed to in the employment agreement, the trial court agreed. So did the Appellate Court. They viewed the application agreement as a contract of adhesion (one that the terms cannot be negotiated — take it or leave it), but that the waiver language was sufficiently clear. However, the Supreme Court unanimously reverses, holding: a private agreement that frustrates the LAD’s public-purpose imperative by shortening the two-year limitations period for private LAD claims cannot be enforced.
NJ’s LAD is a public policy statement. The State find discrimination so abhorrent that it allows for attorneys fees to be awarded should a plaintiff prevail. This is a legal incentive to help root out discrimination in the workplace. Shortening the filing period might cause people who do not know they have an action to miss out or conversely, cause attorneys to file premature LAD cases. A shortened filing period also does not allow employers to investigate claims and root out discrimination. It also prevented the plaintiff from deciding which path to take to pursue an LAD claim (DCR v. Court). All of this is in contravention of the purpose of the law.
The court did note that the LAD does allow for Alternative Dispute Resolution to be used to resolve LAD claims. Perhaps early mediation would have been smart in this case. At this point, both parties have spent a lot of money to get their case to the NJ Supreme Court and now have to start from near square one to resolve the actual case. Same in all of the arbitration cases we looked at in yesterday’s post. The defendant here is potentially on the hook for a lot of attorneys fees — from both sides. Fighting over procedure can be counterproductive and costly.