The New Jersey Employment Law Firm Blog

July 31, 2015

Supreme Court Sides with Job Applicant in Religious Discrimination Claim

The U.S. Supreme Court ruled in favor of a woman who claimed that a clothing retailer violated Title VII of the Civil Rights Act of 1964 when it turned down her job application. She specifically alleged that the retailer discriminated against her because she wore a headscarf as part of her religious practice as a Muslim, which the retailer claimed violated a policy on employee attire. The retailer claimed that she never requested a religious accommodation–such as an exception to the policy prohibiting headwear–and argued that it was not liable for any violation of her rights because it had no “actual knowledge” that she needed an accommodation. The Supreme Court disagreed, holding that the complainant only needed to prove that her need for a religious accommodation motivated the decision not to hire her. Equal Emp’t Opportunity Comm’n (EEOC) v. Abercrombie & Fitch Stores, Inc., 575 U.S. ___ (2015).

The complainant was a teenager when she applied for a job at an Abercrombie & Fitch store in 2008. She wore a headscarf to her interview with an assistant manager at the store. The assistant manager determined that the complainant was qualified for the position. She was reportedly concerned, however, that the complainant’s headscarf violated the store’s “Look Policy,” which regulated how employees dress at work in an effort to maintain a consistent style across the retailer’s nationwide locations. The assistant manager took her concerns to the store manager, who stated that the headscarf violated the Look Policy and instructed the assistant manager not to hire the complainant.

The EEOC filed suit against the retailer in 2009 on the complainant’s behalf, alleging that the decision not to hire her was motivated by her religion, as signified by her headscarf, in violation of Title VII. A district court granted summary judgment for the EEOC on the question of liability. 798 F.Supp.2d 1272 (N.D. Ok. 2011). It awarded the complainant $20,000 in damages after a trial. The Tenth Circuit Court of Appeals, however, reversed these rulings and entered summary judgment for the defendant. It held that the defendant lacked “actual knowledge” of the complainant’s need for a religious accommodation because she failed to request it, and the defendant therefore could not be liable for religious discrimination under Title VII. 731 F.3d 1106 (10th Cir. 2013).
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July 23, 2015

SEC Awards Maximum Damages to Whistleblower Under Dodd-Frank Act

by Resnick Law Group, P.C.

The U.S. Securities and Exchange Commission (SEC) recently awarded $600,000 to a former hedge fund trader who reported possible misconduct by his employer. In the Matter of Paradigm Capital Management, Inc. and Weir, File No. 3-15930, order (PDF file) (SEC, Apr. 28, 2015). The award is the maximum amount allowable under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”). This case is notable because it was reportedly the first enforcement action brought by the SEC under the authority conferred by Dodd-Frank. While the case involves an employer located in Albany, New York, the protections offered by Dodd-Frank apply in New Jersey and nationwide.

The complainant was the head trader for Paradigm Capital Management (“Paradigm”), an investment adviser for various hedge funds. Paradigm’s president and founder was also the president and founder of a broker-dealer called C.L. King & Associates (“C.L. King”). Both entities are incorporated in New York and headquartered in Albany.

In March 2012, the complainant reported alleged misconduct to the SEC based on potential conflicts of interest. He claimed that Paradigm was using C.L. King to execute trades of securities for certain hedge fund clients without disclosing the president’s interest in both companies to those clients. Additional conflicts of interest, according to the SEC, included having the same person serve as chief financial officer of both Paradigm and C.L. King, while also serving on Paradigm’s Conflicts Committee.
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July 16, 2015

Age Discrimination Alleged in New Jersey Lawsuits

by Resnick Law Group, P.C.

Employment discrimination on the basis of age, especially against workers who are into or past what is often considered “middle age,” and who are looking for a job, does not always receive as much media attention as other forms of discrimination. The federal and state laws regarding this type of discrimination are also not as well known or understood. It is becoming more and more of a problem, however, as the American population ages. A few recent cases illustrate how an age discrimination claim in New Jersey might work.

Research regarding the issues faced by older workers indicates that people in their 50s or older tend to have a much harder time finding a job than younger workers. The discrimination is rarely overt, instead taking the form of certain reasons given not to hire someone, such as “You’re overqualified.” This can make discrimination difficult to prove, but the New Jersey Law Against Discrimination (NJLAD) allows claims for age discrimination in employment. N.J. Rev. Stat. § 10:5-12(a). The federal Age Discrimination in Employment Act (ADEA), 29 U.S.C. § 621 et seq., also allows civil claims, but it only applies to workers above a certain age in certain situations.

The NJLAD provides relatively strong protection for workers asserting age discrimination claims. New Jersey courts have held that the statute preempts common law claims, such as breach of contract or breach of the covenant of good faith and fair dealing, if they are primarily based on alleged age discrimination. See Broad v. Home Depot USA, 16 F.Supp.3d 413, 419 (D.N.J. 2014). The ADEA protects workers who are 40 years of age or older against discrimination that is not based on a “reasonable factor other than age.” See 29 C.F.R. § 1625.7, 77 Fed. Reg. 19080 (Mar. 30, 2012). It also prohibits workplace harassment based on age. The statute does not, however, prohibit an employer from favoring an older employee over a younger one.
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July 10, 2015

New York City Prohibits Most Uses of Consumer Credit Reports in Hiring and Other Employment Decisions

by Resnick Law Group, P.C.

The New York City Council passed legislation in April 2015 amending the city’s anti-discrimination law to prohibit employment discrimination based on information found in an employee’s or job applicant’s consumer credit history. This is part of a broader trend of laws at the city and state levels around the country that limit the use of background checks when making employment decisions. Similar laws have been introduced in the New Jersey Legislature, but they have not passed either chamber. New Jersey law offers some protection for consumers with regard to their credit information, including restrictions on when and how employers may access credit reports.

The federal Fair Credit Reporting Act (FCRA), the New Jersey Fair Credit Reporting Act (NJFRCA), and other statutes regulate the collection, distribution, and use of information by credit reporting agencies. These statutes define “consumer reports” in part as financial and personal information about a consumer, communicated in writing or verbally, that is intended for use “in establishing the consumer’s eligibility for…employment purposes.” 15 U.S.C. § 1681a(d)(1)(B), N.J. Rev. Stat. § 56:11-30(1)(b), N.Y. Gen. Bus. L. § 380-A(c)(1)(ii). Under New Jersey law, an employer may not obtain a person’s credit report unless they provide notice in a particular form to the person and obtain the person’s consent. N.J. Rev. Stat. § 56:11-31c.

The New Jersey statute does not prohibit an employer from taking adverse action against an employee or job applicant based, in whole or in part, on information contained in a consumer report. If the employer does take adverse action against a person, however, it must first provide the person with a copy of their consumer report and a notice of their rights under the NJFCRA and the FCRA. N.J. Rev. Stat. § 56:11-31e.
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July 3, 2015

Airlines Operating in New York and New Jersey Face Criticism for Alleged Sex Discrimination and Other Labor Practices

by Resnick Law Group, P.C.

Three airlines are facing allegations of unfair labor practices and sex discrimination in several proceedings. A coalition of U.S.-based airlines and labor unions issued a report earlier this year claiming that the three airlines, which are based in the Persian Gulf region and fly out of airports in New York and New Jersey, engage in unfair competition and unlawful employment practices. The federal government is investigating similar claims. An agency of the United Nations (UN) recently ruled that one of the airlines engaged in ongoing sex discrimination against female employees. While these proceedings generally involve international law and treaties, they could still have an impact on workers who deal with these airlines in New Jersey and New York.

The U.S. began entering into agreements with other countries known as “Open Skies Partnerships” (OSPs) in 1992. It currently has agreements with more than 100 countries. These agreements, according to the U.S. Department of State, allow airlines to expand international service by “eliminating government interference” in various air transportation matters. Since different countries provide different levels of protection for business and labor interests, however, OSPs can result in unfair advantages for some airlines.

A coalition of three U.S. airlines and labor unions, known as the Partnership for Open & Fair Skies (POFS), issued a report in early 2015 criticizing three airlines: Qatar Airways, based in Doha, Qatar; Etihad Airways, based in Abu Dhabi, United Arab Emirates; and Emirates Airlines, based in Dubai, UAE. All three airlines fly out of JFK International Airport in New York City, and Etihad Airways reportedly sometimes flies out of New Jersey’s Newark Liberty International Airport.
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June 24, 2015

New Jersey Discrimination Lawsuit Tests Effect of Medical Marijuana Law on Employment Statutes

by Resnick Law Group, P.C.

Laws regarding medical–or even recreational–marijuana use are undergoing significant changes. Nearly half of the states in the U.S., including New Jersey, now allow marijuana use for at least some purposes. How this affects employees’ rights in New Jersey, however, remains unclear. The issue, which is far from resolved, pits individuals’ right to use marijuana against employers’ right to enforce anti-drug policies. A lawsuit filed last year in New Jersey, Davis v. New Jersey Transit Corp., No. L-001778-14, complaint (N.J. Super. Ct., Essex Co., Mar. 14, 2014), claims disability discrimination against a railroad employee with a valid medical marijuana prescription.

Marijuana remains a Schedule I controlled substance under federal law, 21 U.S.C. § 812(b)(1), and it is still generally illegal under New Jersey law, N.J. Rev. Stat. §§ 2C:35-10a(3)-(4). The New Jersey Compassionate Use Medical Marijuana Act, N.J. Rev. Stat. § 6I-1 et seq., which took effect in 2010, allows the medical use of marijuana under very strict limits. Rather than “legalizing” marijuana, the law creates an exception to state criminal law. N.J. Rev. Stat. § 2C:35-18. It provides that the lawful use of marijuana may not result in “civil or administrative penalt[ies],” N.J. Rev. Stat. § 24:6I-6b, but it does not specifically mention employment or disability protections.

The plaintiff in Davis worked as a procurement clerk for NJ Transit. His doctor gave him a prescription for medical marijuana to alleviate some of the symptoms of end-stage renal failure. He states that he notified his employer of the prescription, but was told that he had to submit to a drug test in December 2013. When the test was positive for marijuana, he was sent to a drug treatment program and lost his job. He filed suit for disability discrimination under the New Jersey Law Against Discrimination. N.J. Rev. Stat. § 10:5-12a. In August 2014, the court denied a motion to dismiss filed by the defendant. The case is still pending.
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June 18, 2015

Former Employee’s Lawsuit Claims Privacy Violations, Wrongful Termination Based on GPS Monitoring

by Resnick Law Group, P.C.

An employer demanded that its employees allow around-the-clock monitoring of their whereabouts and then terminated an employee because of her refusal to comply, according to a lawsuit filed last month. Arias v. Intermex Wire Transfer, LLC, et al, No. _____, complaint (Cal. Super. Ct., Bakersfield Co., May 5, 2015). The lawsuit’s claims include invasion of privacy, retaliation, and wrongful termination. The case involves smartphone and Global Positioning System (GPS) technology, and it may therefore present questions that are relatively novel to the legal system. The retaliation claim is based on a California statute that is similar to laws in New Jersey and New York.

The plaintiff began working for the defendant as an account manager in February 2014. According to her complaint, her supervisor told her that she was expected to keep her phone powered on at all times in order to receive calls from clients. In April 2014, the defendant allegedly instructed its employees to install a mobile application (“app”) known as Xora on their smartphones. This app uses the phone’s GPS capabilities to track users’ whereabouts and movements.

The plaintiff’s supervisor allegedly told her that the company would be monitoring employees during both work and non-work hours. While she did not object to monitoring during work hours, the plaintiff claims that she objected to off-hours monitoring as an invasion of her privacy, and that she believed the defendant’s request was illegal. She states in her complaint that she removed the Xora app from her phone in late April 2014, and that on May 5, 2014, she was terminated.
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June 10, 2015

Discrimination, Harassment Lawsuit Targets the Tech Industry

by Resnick Law Group, P.C.

A former program manager for the internet company Facebook has filed a lawsuit against the company in state court in California, alleging sexual harassment and discrimination based on race and gender. Hong v. Facebook, Inc., et al, No. CIV-532943, complaint (Cal. Super. Ct., San Mateo Co., Mar. 16, 2015). The case alleges numerous acts of conduct towards the plaintiff that, when taken in isolation, might seem minor, but that add up over time to constitute significant disparate treatment based on her gender and her national origin. The laws at the state and federal level are clear that employers may not discriminate in promotions, job duties, and other features of employment based on these categories. These types of claims, unfortunately, can be difficult to prove. Another recent lawsuit against a Silicon Valley venture capital firm made similar allegations but resulted in a jury verdict for the defendant. The current case makes a wide range of allegations, however, that indicate overtly discriminatory treatment towards the plaintiff.

According to her complaint, the defendant hired the plaintiff in June 2010 for the position of program manager. It transferred her to “technology partner” in October 2012. She claims that she performed her job duties well throughout her time with the company, pointing to “satisfactory performance evaluations” and regular raises as evidence. Hong, complaint at 2. Prior to the events immediately preceding her termination, she states that she “received no significant criticism of her work.” Id. She was allegedly terminated on October 17, 2013.

The plaintiff alleges that multiple employees of the defendant, including her supervisor, who is named individually as a defendant, and others identified in the complaint as “Does One through Thirty,” discriminated against her based on gender. This allegedly included comments belittling her work and admonishment for “exercis[ing] her right under company policy to take time off to visit her child at school.” Id. at 3. She also claims that she was given assignments that no male co-workers were expected to do, such as organizing office parties and serving drinks. She makes a direct allegation that the company hired a “less qualified, less experienced male” to replace her. Id.
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June 4, 2015

Lawsuits, Pending Legislation, Address Question of Whether NFL Cheerleaders Are Employees or Independent Contractors

by Resnick Law Group, P.C.

The question of whether an individual is an “employee” or an “independent contractor” determines whether or not they enjoy the protection of a wide range of employment laws at the city, state, and federal levels. Employees of covered employers are protected by laws related to minimum wage, overtime pay, and other matters. Independent contractors, however, are generally considered to be self-employed, and in a mere contractual relationship with the employer. Employers clearly have an interest in classifying people as independent contractors whenever possible, but some workers have begun to push back. One place where this is occurring is among the cheerleading squads of professional football teams, who claim that they are employees of the teams, not independent contractors. Multiple lawsuits, including one in New Jersey, are asserting claims for wage violations, and a bill pending in the California Legislature would formally grant “employee” status to professional sports team cheerleaders.

A putative class action filed in a New Jersey court alleges that the New York Jets football team underpays its cheerleading squad. Krystal C. v. New York Jets LLC, No. L-004282-14, complaint (N.J. Super. Ct., Bergen Co., May 6, 2014). The plaintiff alleges that the team entered into an “Employment Agreement” with her, identifying them as “Employer” and “Employee,” respectively. She claims that she was paid $150 per game at which she performed, and $100 for each team-sponsored “outside event” sponsored by the team at which she was present on the team’s behalf. The amount of work required of her, however, was allegedly so extensive that it rendered the pay she actually received substantially lower than the state minimum wage, often as little as $3.77 per hour.

The plaintiff in Krystal C. does not directly raise the question of misclassification in her complaint, but her factual allegations depict a level of control over the cheerleaders’ work duties that fits the legal definition of an employer-employee relationship. The claimed class consists of current and former cheerleaders for the Jets employed within two years of the date she filed the complaint. She is claiming violations of the New Jersey Wage and Hour Law, N.J. Rev. Stat. § 34:11-56a et seq., and is asking the court to award all wrongfully withheld pay to the class members. As of early May 2015, the case is still pending in a New Jersey Superior Court.
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May 27, 2015

EEOC Examines Risk of Discrimination in Wellness Programs Offered by Employers Under the Affordable Care Act

by Resnick Law Group, P.C.

The Patient Protection and Affordable Care Act (ACA, or “Obamacare” to some) creates a variety of incentives to encourage employers to create and sponsor “wellness programs” for their employees. Several federal agencies, including the Department of Labor (DOL), have issued rules implementing these incentives within the requirements of federal statutes like the Health Insurance Portability and Accountability Act (HIPAA). The Equal Employment Opportunity Commission (EEOC), which enforces employment nondiscrimination statutes, was not involved in those rulemaking processes. It issued a Notice of Proposed Rulemaking in March 2015, stating that it will review how the Americans with Disabilities Act (ADA), 42 U.S.C. § 12101 et seq., affects the wellness program provisions of the ACA. It issued a proposed rule in April.

The Public Health Service Act (PHSA), as amended by HIPAA and the ACA, defines a “wellness program” as “a program offered by an employer that is designed to promote health or prevent disease.” 42 U.S.C. § 300gg-4(j)(1)(A). HIPAA prohibits discrimination in group health plans, in terms of eligibility, benefits, and other factors, based on a participant’s health. It makes one exception, however, by allowing discounts, rebates, or other benefits for participants who follow an employer-sponsored wellness program.

The DOL, the Department of Health and Human Services (HHS), and the Internal Revenue Service (IRS) jointly issued a final rule implementing the HIPAA nondiscrimination provisions for wellness programs. 71 Fed. Reg. 75014 (Dec. 13, 2006). The rule established two types of wellness programs: participatory programs, which should be made available to all similarly-situated employees regardless of their health status; and health-contingent programs, which may be tailored to employees’ particular health needs, such as a program to help employees quit smoking.