Former Uber engineer Susan Fowler Rigetti’s story of sexual harassment and the company’s inadequate response to her multiple complaints, highlight how important it is for a company to have an effective action plan in dealing with these sensitive issues.

The following is some practice pointers on what a company should do (and not do) when it receives an employee complaint of discrimination/harassment or other misconduct by another employee:

  1. Understand the complaint

New Jersey’s Third Circuit recently held in Karlo v. Pittsburgh Glass Works, LLC, No. 15-3435, 2017 WL 83385 (3d Cir. Jan. 10, 2017), that workers in their 50s may be recognized as a “subgroup” of employees protected by the Age Discrimination in Employment Act (“ADEA”) if an employer’s policies inadvertently disfavor them relative to their co-workers who are over age 40 and, therefore also protected employees under this law.

The plaintiffs in Karlo were all over age 50 and had worked in defendant’s Manufacturing Technology division until they were terminated in 2009 as part of a reduction in force. Plaintiffs then brought a collective action under the ADEA, asserting disparate treatment, disparate impact, and retaliation as to two of the plaintiffs. The district court granted the employer’s motion for summary judgment on the disparate impact claim, holding that a disparate impact claim for the “fifty-and-older” subgroup relative to their younger yet age-protected co-workers was not permitted under the ADEA because the law does not permit subgroup claims. The court also found that plaintiffs lacked evidence to support their claim.

The Third Circuit reversed the district court’s ruling on summary judgment and held that the plaintiffs could pursue their claims. According to the court in Karlo, plaintiffs are permitted to use subgroup comparisons and similar evidence to demonstrate the significantly disproportionate adverse impact necessary for a disparate impact claim under the ADEA. The appeals court emphasized that the ADEA prohibits age discrimination as a whole, not just discrimination against employees ages 40-and-over. Thus, the court found that the plaintiffs are permitted to bring claims alleging that they were treated less favorably than their younger counterparts, even where their younger co-workers included employees within the ADEA’s protected class.

Judge Kevin McNulty of the U.S. District Court for the District of New Jersey dismissed a pro se action that plaintiff Erwin LeJon-Twin El, who changed his name upon joining the Moorish Science Temple of America, brought against his employer Impax Laboratories alleging several claims of discrimination based on his national origin.

In October 2014 Mr. LeJon-Twin El announced his new name to his employer. The employer agreed to use the new name whenever possible but would still use his birth name for federal I-9 and payroll tax purposes. The employer agreed to use the new name whenever it was legally changed.

In April 2016, LeJon-Twin El sued Impax, claiming the company discriminated against him based on his national origin. The Court held that an employer’s making out a paycheck to a worker under his birth name, rather than a new name that was not formally changed through appropriate government channels, was not a discriminatory act. Moreover, the Court found that plaintiff, who was still being paid with no diminution in pay, responsibilities or benefits, had not suffered an adverse employment action.

In Noren v. Heartland Payment Systems, Inc., Docket No. A-2651-13T3, __N.J. Super. __ (Feb. 6, 2017), the New Jersey Appellate Division held that a provision in an employment agreement which provided that the employee “irrevocably waive[s] any right to trial by jury in any suit, action or proceeding under, in connection with or to enforce this Agreement” was unenforceable as to a former employee’s statutory employment claims.

Following his termination of employment, Noren sued his former employer alleging a violation of the Conscientious Employee Protection Act (“CEPA”), New Jersey’s employment whistleblower law. The lower court denied Noren’s demand for a jury trial based on the jury-waiver provision in his employment agreement and dismissed Plaintiff’s complaint after a lengthy bench trial. Plaintiff appealed, challenging the application of the jury waiver provision to his CEPA claim.

On appeal, the court focused upon the fact that CEPA and the New Jersey Law Against Discrimination (“NJLAD”) expressly guarantee a right to a jury trial. Given the statutorily guaranteed right, the Appellate Court determined that in order for the waiver to be effective it must “clearly explain (1) what right is being surrendered and (2) the nature of the claims covered by the waiver.” The court found that the jury waiver at issue was unenforceable because it did not make any “reference to statutory claims and did not define the scope of the claims as including all claims relating to Noren’s employment.”

In a recent New Jersey federal case, ADP LLC v. Lynch, 3d Cir. (Ambro, U.S.C.J.), the Third Circuit declined to lift an injunction prohibiting two former employees of ADP from soliciting its clients on behalf of a competitor. The injunction partially enforced non-compete agreements that Jordan Lynch and John Halpin agreed to online in what is commonly referred to as a “clickwrap” agreement. A clickwrap agreement is a type of contract in which a user must agree to terms and conditions prior to using the product or service. These are commonly used in the software or technology industry. It is interesting to see a court confirm its enforceability in the employment context.

Messrs. Lynch and Halpin each participated in ADP’s stock award plan for five consecutive years. To participate, they had to click on an electronic box to acknowledge that they had read related documents. Those documents included restrictive covenants which state that the employee cannot (1) solicit certain clients and prospective clients of ADP for one year after they stopped working for the company; (2) disclose any of ADP’s confidential information; or (3) use ADP’s confidential information regarding the identity of the company’s current, past or prospective clients. Mr. Lynch also signed a separate agreement, containing similar restrictions.

The employees resigned their sales positions at ADP and joined its direct competitor, Ultimate Software Group (“USG”). ADP sued Mr. Halpin and Mr. Lynch, asserting that they had violated their restrictive covenants. It also sought a preliminary injunction to prohibit them from working for USG and from soliciting ADP’s clients. Mr. Halpin and Mr. Lynch claimed that they never actually read or agreed to the restrictive covenants and therefore, the court should decline to enforce them as written.

Despite the finding of a prima facie case of race discrimination, a New Jersey appeals court has upheld the firing of a Muslim corrections officer who refused to remove her headscarf on the job.

Linda Tisby began working at the Camden County Correctional Facility in 2002 but became a Muslim in 2015 and one day reported to work wearing the khimar, or headscarf. She refused to remove it, was sent home and recommended for disciplinary charges. After continuing to report to work wearing the khimar, the Correctional Facility dismissed Tisby on May 11, 2015.

Tisby filed two separate suits against Camden County and the Camden County Correctional Facility. The first, filed on June 12, 2015, sought damages under the NJ Law Against Discrimination (“NJLAD”) and alleged that the jail had permitted other women to work with head coverings, including Muslim women and those undergoing chemotherapy. A month later, she filed a second suit, seeking reinstatement and back pay and asserting violations of the NJLAD.

The NJ Supreme Court recently ruled that the New Jersey State Police’s failure to assert a sovereign immunity defense during its trial on an Americans with Disabilities Act claim does not constitute a waiver of sovereign immunity.

This case was brought by Brian Royster, a state trooper who suffered from ulcerative colitis. His condition required that he have immediate access to a bathroom while on the job. After returning from medical leave for treatment of his condition, his department assigned him to conduct surveillance from a car. He repeatedly asked to be moved to an assignment that offered access to a restroom, but he remained on the surveillance assignment for seven months.

Royster filed suit against the state police, asserting, among other claims, that it failed to make reasonable accommodation for his medical condition in violation of the ADA and the NJLAD, and for retaliation under the ADA, NJLAD, and the New Jersey Conscientious Employee Protection Act (“CEPA”). The state trial court dismissed several claims, leaving only the CEPA retaliation and the ADA failure-to-accommodate claim for trial. The jury awarded the employee $500,000 in damages on the ADA claim.

In a positive development for workers, the New York Attorney General, Eric Schneiderman, announced that six major retailers have agreed to stop using on-call shift scheduling after an inquiry by a multistate coalition of attorneys general. On-call shifts involve employees required to call their employers a few hours before they are supposed to work, to see if they will be scheduled for work.

We have found that this arrangement is designed to provide the employer flexibility in case it’s labor needs increase or decrease. The problem for the worker is that he or she would presumably need to keep the day open, arrange for childcare, and forsake other opportunities without being compensated for their time. We are pleased that the companies, Aeropostale, Carter’s David’s Tea, Disney, PacSun and Zumiez, have voluntarily agreed to stop this unfair method of scheduling and eliminate a potential hardship for their employees.

I usually blog about New Jersey unemployment cases and determinations but there is an interesting case that was just decided in New York that is worth noting. Although the legal standard for entitlement to unemployment benefits differs between the states, both New Jersey and New York ultimately look to see how much “control” the business exercises over the worker in making its determination on how the relationship should be classified. The more control a business has over the worker in the nature and manner of the work performed, the more likely it is that he or she will be considered an employee who is entitled to unemployment benefits.

In the New York case, Yoga Vida NYC, Inc. v. Commissioner of Labor, No. 130 (N.Y. Oct. 25, 2016), the New York State Court of Appeals issued a rare decision, concluding that the employer yoga studio did not exercise sufficient control over certain of its instructors to create an employment relationship, thereby disqualifying the workers for unemployment compensation benefits.

Yoga Vida, a Manhattan-based yoga studio, offers classes taught by both staff instructors, classified as employees, and non-staff instructors, classified as independent contractors. The NYS Unemployment Insurance Appeal Board held that the non-staff instructors were misclassified as independent contractors and that Yoga Vida was therefore responsible for paying additional unemployment contributions. Yoga Vida appealed to the Appellate Division, which affirmed the determination of the Appeal Board. The NYS Court of Appeals reversed, finding that the non-staff instructors were not employees because Yoga Vida did not exercise sufficient control “over the results produced and the means used to achieve the results.”

In a recent employment discrimination case, Cuevas v. Wentworth Group, the NJ Supreme Court upheld the jury’s award of emotional distress damages to the Plaintiffs, Ramon and Jeffrey Cuevas, two brothers who suffered derogatory and humiliating racial remarks and discrimination at work. The brothers are Hispanic. Wentworth fired the brothers shortly after Jeffrey complained about the harassment.

At the trial court level, the jury awarded over $1 million in lost wages, $800,000 in emotional distress damages and $52,500 in punitive damages to Ramon. It awarded Jeffrey $150,000 in lost wages, $600,000 in emotional distress damages and $32,500 in punitive damages. Both the trial court and the Appellate Division denied defendants’ request for a remittitur (reduction) of the emotional distress damages.

On certification, the New Jersey Supreme Court upheld the jury’s emotional distress damages award to the Cuevas brothers. The Court held that a judge should not rely on personal knowledge of other verdicts or comparative-verdict methodology when deciding a remittitur motion to reduce a damage award because each case is unique. Moreover, the Court held that a judge should only consider the record itself, in order to maintain the deferential standard of review of a jury’s award of damages.