New Jersey Whistleblower Lawsuit Not Preempted by Federal Law, State Supreme Court Rules

Legal News GavelIn New Jersey, employment laws at the federal and state levels protect a variety of employee rights. When federal and state laws conflict with each other, the preemption doctrine holds that federal law usually supersedes state or local laws. The New Jersey Supreme Court ruled last year on an appeal of of a ruling that a New Jersey whistleblower claim was preempted by federal law. The court reversed the lower court rulings, finding that the plaintiff’s claims were not preempted. Puglia v. Elk Pipeline, Inc., 141 A.3d 1187 (N.J. 2016).

The New Jersey Conscientious Employee Protection Act (CEPA) prohibits retaliation against employees who report suspected violations of law by their employers. N.J. Rev. Stat. § 34:19-3. The plaintiff in Puglia had complained of alleged violations of New Jersey’s Prevailing Wage Act (PWA), which governs wages paid by companies involved in public works contracts and which allows employees to protest alleged violations. Id. at § 34:11-56.34.

The federal National Labor Relations Act (NLRA) and Labor Management Relations Act (LMRA) govern collective bargaining agreements (CBAs) between management and labor unions. Section 301 of the LMRA gives federal courts jurisdiction over disputes between employers and labor organizations. 29 U.S.C. § 185(a). The U.S. Supreme Court has “given broad substantive effect” to this provision. Puglia, 141 A.3d at 1192. It therefore preempts almost any case that involves “what the parties to a labor agreement agreed.” Id. at 1193, quoting Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 211 (1985).

Sections 7 and 8 of the NLRA protect workers’ rights to engage in labor organizing activities. 29 U.S.C. §§ 157, 158. The law gives the National Labor Relations Board (NLRB) jurisdiction over disputes as to which activities are protected under the NLRA, effectively preempting both state and federal courts. Puglia at 1193, citing San Diego Building Trades Council v. Garmon, 359 U.S. 236, 244, (1959).

The plaintiff in Puglia worked as a laborer for the defendant, a construction company, subject to the terms of a CBA. The defendant had contracts for public works projects, which required it to comply with the PWA. According to the court’s opinion, the defendant cut the plaintiff’s pay in half in early 2010, reportedly without warning. The plaintiff, along with a coworker, asked a supervisor about the pay cut upon learning of it. He was informed that the defendant had placed him in an apprenticeship program. The plaintiff alleges that no such program ever existed. After trying to have the matter resolved at multiple levels of management, the plaintiff alleges that he was terminated toward the end of 2010. He sued under CEPA.

The trial court dismissed the case, ruling that it was preempted by the LMRA and the NLRA. The Appellate Division affirmed. 100 A.3d 191 (N.J. App. 2014). The New Jersey Supreme Court reversed these rulings. It ruled that § 301 only preempts claims involving alleged violations of CBAs, while this case alleged a statutory violation. It further ruled that the case was not preempted by the NLRA, finding that the state’s interest in whistleblower protection was “balanced against any potential interference with the federal labor scheme.” Puglia at 1208.

If you need to speak to a whistleblower attorney about a matter in New Jersey or New York, contact the Resnick Law Group today online, at 973-781-1204, or at (646) 867-7997.

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New York City Mayor Issues Executive Order Regarding Union Organizing, The New Jersey Employment Law Firm Blog, September 22, 2016

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