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No Economic Damages In CEPA Case without Actual or Constructive Discharge

Sunday, February 28th, 2010

Under the New Jersey Law Against Discrimination (NJLAD), victims of discrimination may be entitled to  front or back pay (economic damages) if their employer fires them or makes their working conditions so intolerable that a reasonable person would feel that they have no option but to quit (a “constructive discharge); they are not entitled to damages if they voluntarily quit.  Last week,  the Appellate Division ruled that victims of retaliation under the New Jersey Conscientious Employee Protection Act (CEPA) likewise cannot recover economic damages unless they were fired or constructively discharged.  Although DuPont may have avoided liability, the case is a stark reminder that retaliation is all too common in response to complaints, the need for employers to take these allegations seriously, and juror sympathy to workers who have suffered retaliation.

In  Donelson v. Dupont Chambers Works, the New Jersey Appellate Division threw out a jury verdict of over $1.2 million ($724,000 in economic damages and $500,000 punitive damages) under the New Jersey Conscientious Employee Protection Act, because plaintiff never argued that he was constructively discharged.   In Donelson, the plaintiff claimed that his employer and co-workers retaliated against him after he complained about potential  Occupational Safety and Health Administration (OSHA) violations.  More specifically, .he  claimed that Dupont imposed restrictions on him, not imposed on others, concerning his use of vacation, sick time and personal leave days; falsely ccused him of failing to complete required employee training; accused him of failing to attend some of the safety meetings in the summer, even though DuPont had always excused him from such summer meetings in the past; falsely accused him of being lazy and described him in an internal memorandum as “not [one of] our best performers”; ordered him to notify a supervisor when and where he was going to lunch, a rule not imposed on other operators; and described him in an e-mail as a “very high maintenance” employee over whom management should maintain a “watchful eye.”

The plaintiff alleged that the retaliation escalated over time.  He claimed that he was wrongly disciplined for failing to perform required tasks.  He also alleged that DuPont failed to investigate other hotline complaints that he raised. Plaintiff also claimed that his employer required him to undergo a humiliating mental status examination, which resulted in an eight week mandatory disability leave of absence based on the clinician’s conclusion that plaintiff was too emotionally stable to work.  After plaintiff returned from the two month leave in June 2004, he claimed that this mandatory leave made him feel “kicked to the curb” and worthless, and that he  worried about new allegations.

Plaintiff filed suit in February 2005, and went on a voluntary leave of absence in January 2007, from which he never returned.  Instead, he retired from DuPont in December 2007.  At trial, plaintiff claimed that, since that time, he earned $50,000 to $60,000 less per year than he had earned at DuPont.

At trial, the jury found that DuPont had retaliated against plaintiff in violation of the New Jersey Conscientious Employee Protection Act, resulting in economic damages of $724,000.  The jury found that there was no emotional distress damage, but also awarded $500,000 in punitive damages.

The Appellate Division vacated this entire award.  CEPA defines “retaliatory action” as “the discharge, suspension or demotion of an employee, or other adverse employment action taken against an employee in the terms and conditions of employment.” The Appellate Division also recognized that retaliation is not limited to a single discrete action, but may include “many separate but relatively minor instances of behavior directed against an employee that may not be actionable individually but that combine to make up a pattern of retaliatory conduct.”  Nevertheless, the Appellate Division held that, because plaintiff never claimed that he was forced to leave his job, DuPont could not be responsible for the economic damages resulting from plaintiff’s voluntary resignation.  The Court did recognize, however, that plaintiff would have been entitled to emotional distress damages, even if he had not been forced out.

Interestingly, the trial court judge suggested that the facts might support a constructive discharge claim. 

It is likely that this decision will be appealed to the New Jersey Supreme Court.