The New Jersey Appellate Division recently issued an important decision clarifying how claims brought under the Law Against Discrimination (LAD) interact with agency proceedings in employment matters. Specifically, it made two critical points that every employer should understand:
First, employees don’t need to wait for — or even participate in — administrative hearings to file discrimination lawsuits. The LAD gives workers a direct path to court.
Second, employers can’t contract away anti-discrimination rights. The court rejected the idea that the plaintiff waived her LAD protections by signing an agreement with a 15-day appeal window. Agreements that try to shorten LAD deadlines or limit rights won’t hold up in court.
Background
Plaintiff Pamela Graziadei worked in a hospital in a director-level managerial nursing position. She alleged that she failed a breathalyzer test at work due to consuming alcohol the night before and was then referred to the Recovery and Monitoring Program of New Jersey (RAMP), which provided “recovery and monitoring programs on behalf of” the New Jersey State Nurses’ Association and the Institute for Nursing, Inc.
Two weeks after her positive test, she and RAMP agreed to a “private letter agreement” (PLA) that stated in relevant part that if she violated the terms of the PLA her nursing license may be automatically suspended, that she would have the right to “request a hearing to contest the entry of such an order” and the sole issue to be determined at the hearing would be whether any of the information received to suspend her was false.
Graziadei then went on leave from work where she alleges that she was advised her job was protected – however, during her leave, she was told she would not be able to return to her management level position for two or three years, although Graziadei then alleges that number grew to five years.
When Graziadei returned to work, despite her compliance with RAMP’s program, she was not returned to her former position as a supervisor and her salary was reduced by half. She thereafter filed suit, alleging that she was being discriminated against on the basis of alcoholism in violation of the LAD.
Three years into the litigation, Graziadei was granted leave of Court to file an amended pleading to allege in part that RAMP discharged her from the program due to alleged non-compliance and the discharge put her license in jeopardy because her license had been suspended per the PLA.
The trial court, however, subsequently dismissed Graziadei’s complaint for lack of jurisdiction, reasoning that until Graziadei exhausted her administrative remedies by the terms of the PLA, she could not bring this LAD action in court.
Appellate Ruling
The Appellate Division reversed. In its decision, the Court began with the baseline that alcoholism is a disability protected under the LAD. With respect to the question of jurisdiction, the express terms of the LAD allow for either a potential plaintiff to bring an action before the New Jersey Division on Civil Rights or directly into court; put another way, there is no administrative exhaustion requirement in the statute. And, if an employee believes that she has been the victim of discrimination, she is not required to raise that as a defense in a disciplinary proceeding; she has the right to bring her own affirmative action in a manner consistent with the LAD statute.
The Court next addressed whether the existence of the PLA impacted Graziadei’s substantive rights to bring her LAD claims. The Court decided that the PLA did not have the effect of curbing her substantive LAD rights by virtue of the 15-day appeal period because the LAD statute prohibits agreements to waive substantive LAD rights as well as the shortening of the limitations period by agreement.
The final issue to resolve was whether Graziadei’s complaint was an attack on a final agency decision. The Court found it was not for a myriad of reasons – Graziadei had substantive LAD statutory rights to file a complaint in state court; LAD claims are not peculiarly within the Nursing Board’s discretion or expertise; there was no concern of inconsistent rulings between the agency and court because they were adjudicating separate legal issues; and Graziadei had not raised as a defense to the suspension of her license the discrimination she alleged in this complaint.
Takeaways
In sum, this case serves to remind employers that courts will not look kindly on any attempts to shorten or narrow the rights and protections provided to plaintiffs under the LAD. And it provides helpful guidance on the relationship between an LAD complaint and agency proceedings dealing with separate employment-related issues.
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