Written Warning Could be an Adverse Employment Action under the NJLAD

The New Jersey Appellate Division recently held that a written warning, if part of a system of progressive discipline, may constitute an adverse employment action under the New Jersey Law Against Discrimination (“NJLAD”), which in turn could mean an employer could be held liable for discriminatory or retaliatory actions.

In Prager v. Joyce Honda, Inc., No. A-3691-14T3, ____N.J. Super _____ (App. Div. August 22, 2016), Plaintiff was a former receptionist who was inappropriately touched by a long-standing, valued customer of the Joyce Honda car dealership. Plaintiff filed a municipal court complaint against the customer. Plaintiff claimed that she thereafter became isolated by her coworkers and, about a week after she filed the report, received two written warnings for leaving early without permission. When management presented Plaintiff with the written warnings, she became upset, stating that the warnings were false and issued in retaliation for pressing charges against the customer. The Plaintiff claimed that she had left early many times before without incident and that her high level of anxiety was causing her to throw up before work. In response, management offered to rescind the warnings and suggested that if work was making her feel sick; it would be in her best interest to resign. Plaintiff resigned the next day.

Plaintiff then filed a lawsuit against Joyce Honda, claiming retaliation under the NJLAD. The trial court dismissed, holding that Plaintiff’s municipal court complaint against the customer was not protected activity under the NJLAD. On appeal the Appellate Division affirmed on different, but notable grounds. The Appellate Division found that the Plaintiff’s municipal court complaint was protected activity. Nevertheless, her retaliation claim failed because she could not demonstrate that the two written warnings constituted an adverse employment action. The court used an objective standard to evaluate whether the warnings were an adverse employment action: whether a reasonable person could have found them to be materially adverse. It noted the analysis was case specific, and explained that a written warning could be deemed a materially adverse employment action, such as in the case where a formal system of progressive discipline exists and is enforced. In the Prager case the Appellate Division ruled that the written warnings Plaintiff received were not an adverse employment action since it was not certain that Plaintiff would receive future discipline (Plaintiff resigned the next day and the employer offered to rescind the warnings).

Prior to Prager New Jersey courts generally found that written warnings, absent consequential discipline, did not constitute adverse employment actions. This case makes it clear that, if the warnings set forth even future mandatory progressive discipline, such warnings may be considered an adverse employment action for purposes of imposing liability under the NJLAD.