September 3, 2016

Shortening the statute of limitations for discrimination cases?

Posted in Employment Law by Gene Killian |

Have you ever stopped to get directions in a foreign country where the people may not speak English so well?  For some reason we Americans think that if we speak LOUDLY and SLOWLY, the listener’s comprehension will increase.  But, of course, it doesn’t.  (On a separate but tangentially related point, if you spend any significant time on social media, then you know that USING ALL CAPS IS CONSIDERED IMPOLITE, because it’s the equivalent of yelling at someone.)

We lawyers sometimes use ALL CAPS in legal documents to highlight provisions that are thought to be PARTICULARLY IMPORTANT.  And sometimes, similar to the streets of Paris or on Twitter, it doesn’t work so well. This recently became clear in an employment discrimination case decided by the Supreme Court of New Jersey, Rodriguez v. Raymours Furniture Co.

Rodriguez, who was from Argentina, applied for a job at Raymours.  His English was poor, so a friend helped him fill out the employment application. The application stated in ALL CAPS that any employment-related lawsuit would have to be brought within six months of the date of the alleged wrongdoing, and that employees waived any right to a jury trial. The statute of limitations under the New Jersey Law Against Discrimination, N.J.S.A. 10:5-12, is two years.

Rodriguez injured his knee in a work-related accident during a furniture delivery. He was out of work for an extended period. Two days after resuming full-duty work, he was terminated. His supervisor informed him that he was being RIF’d because business was slow.

Rodriguez may not have spoken English very well, but he definitely knew how to get to the office of his friendly neighborhood plaintiffs’ lawyer. He filed a complaint against Raymours, alleging illegal employment discrimination based on an actual or perceived disability in violation of the LAD, and retaliation for obtaining workers’ compensation benefits.  Raymours defended by arguing that the suit was too late, because it was filed after the six-month ALL CAPS limitation period contained in the employment application had expired.  The trial court agreed.  So did the Appellate Division.

Unfortunately for Raymours, that wasn’t the end of the story.  The Supremes struck down the six-month limitations period based on public policy considerations. 

The Court wrote: “Shortening the time permitted for bringing an LAD action in Superior Court [2 years] directly impacts and undermines the integrated nature of the statutory avenues of relief and the election of remedies that are substantively available to victims of discrimination under the LAD. An LAD complainant has two years to file his or her action and Superior Court, and, during that time, the individual may choose between the two means of relief that the LAD authorizes. The Legislature allows an LAD litigant to take advantage of the less costly and more efficient process offered through the administrative remedy [proceedings in the Division of Civil Rights], but, if that process extends too long, the aggrieved individual can opt to withdraw his or her administrative complaint and file in Superior Court…Explicitly then, the Legislature understood and accepted that public policy acquires a more lengthy period of time to obtain LAD relief through that permissible combination of avenues…[Here], plaintiff’s substantive right to utilize all available avenues in relief, in tandem, is effectively foreclosed. As the six-month period runs, litigants would be forced to choose between filing with the DCR or filing in Superior Court because there would not be enough time to choose to begin with a filing with the DCR. Further, the shortening of the applicable statute of limitations, if allowed here, results in cutting off the opportunity to fulfill the public interest in eradicating discrimination.”

A few takeaways:

1.  Any time the Court starts talking about “public policy,” if you’re on the defense side, you know you’re in trouble. It means that whatever the contract says is about to be rewritten to remove what you thought were protections in the contract.  That’s why proper operational controls (and common sense!) are always the first line of defense.  Job one is always to prevent litigation from happening.  You can’t count on the Court enforcing pro-management provisions in an employment contract

2.  To state the obvious, victory at the trial court level often doesn’t end the issue. Trial courts are under enormous pressure to dispose of cases. Here, the trial court lightened its load by enforcing the contractual limitations period. But the higher up the chain in the court system the case gets, the more likely the court is to look at public policy concerns, instead of concerns about efficiency. Which leads back to point one. Litigation is expensive. Do everything you can to prevent it from happening. I obviously wasn’t there, so I don’t know all the details of the Rodriguez case, but firing an employee who just came back from disability leave is something that should never be done lightly.

3.  I’m not a huge fan of arbitration in many cases. Despite its marketing theme, it can actually be quite expensive and time-consuming.  Many businesses would prefer to avoid the capriciousness of the jury system (not that judges are all that much better!) so I sometimes advise them to include a provision in their contracts waiving both sides’ right to a jury trial (essentially, agreeing to a bench trial) instead of an arbitration provision.  Given the decision in Rodriguez, it’s going to be a fight to enforce jury trial waivers in employment contracts, just like it’s been a fight to enforce arbitration agreements in employment contracts.  Another reason to avoid litigation whenever possible. (Remember, if you lose a discrimination case, you also get to pay the plaintiff’s legal fees.)  

You can read a full copy of the Rodriguez decision by clicking here.