The New Jersey Supreme Court has endorsed an employer’s right to assert its effective anti-harassment policies and remedial measures as an affirmative defense in opposition to New Jersey Law Against Discrimination (“LAD”) claims of hostile work environment sexual harassment based on the conduct of a supervisor. Ilda Aguas v. State of New Jersey, No. A-35-13 (N.J. Sup. Ct. Feb. 11, 2015). 

The Court said the defense “furthers the LAD’s purpose of eliminating sexual harassment in the workplace by motivating employers to maintain effective anti-harassment policies, and by encouraging employees to take prompt action against harassing supervisors in accordance with those policies.”

The Court also adopted the Equal Employment Opportunity Commission’s definition of who is a supervisor for purposes of determining vicarious liability. This definition is more expansive than the one adopted by the U.S. Supreme Court.

Background

Corrections officer Ilda Aguas worked for the State of New Jersey. She claimed her supervisor and other officers subjected her to hostile work environment sexual harassment in violation of the LAD. Although Aguas alleged she reported the harassment orally prior to filing a lawsuit against the employer, she did not file a written complaint in accordance with the employer’s written anti-harassment policy, which she received each year of her employment and had resorted to twice before. Instead, she filed the lawsuit against the State two days after the employer initiated an investigation into the oral report of harassment. 

Following pretrial discovery, the trial court granted summary judgment to the employer and dismissed the plaintiff’s lawsuit. The court concluded the State had established an affirmative defense to liability because the plaintiff failed to follow the employer’s written anti-harassment policy. 

The Appellate Division affirmed the trial court’s dismissal of the case. 

Two-Part Defense

By a 5-2 vote, the New Jersey Supreme Court expressly adopted the familiar two-part affirmative defense to hostile work environment claims, commonly referred to as the “Ellerth-Faragher Defense,” established by the U.S. Supreme Court in 1998.Burlington Industries v. Ellerth, 524 U.S. 742 (1998); Faragher v. City of Boca Raton, 524 U.S. 775 (1998). 

Under the Ellerth-Faragher framework, the employer in a hostile work environment sexual harassment case where no tangible job action was taken against the employee may assert the affirmative defense if it can show by a preponderance of the evidence that it: 1) “exercised reasonable care to prevent and correct promptly any sexually harassing behavior,” and 2) “the plaintiff unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to avoid harm otherwise.” The Court emphasized that an employer must demonstrate the existence of an effective anti-harassment policy and the employee failed to utilize the policy to report and remediate the harassment. 

The Court remanded the case to the trial court for further consideration consistent with its opinion.

Implications

The Court’s decision clarifies two issues. First, the decision reassures employers that they may avail themselves of the Ellerth-Faragher affirmative defense even if the alleged harassment is committed by a supervisor, thus removing the possibility that employers can be held strictly liable for harassment by a supervisor. 

Second, by adopting the Equal Employment Opportunity Commission’s broad definition of “supervisor” for purposes of determining vicarious liability, which includes all employees who have authority to take tangible employment actions or control the day-to-day activities of another employee, the Court departed from the U.S. Supreme Court’s definition under Title VII of the Civil Rights Act in Vance v. Ball State University, 133 S. Ct. 2434 (U.S. 2013). That Court had held that only employees who have authority to take tangible job actions against another employee are supervisors. 

Employers should pay close attention to an issue not addressed directly by the New Jersey Supreme Court, but may be considered by the trial court on remand: Whether an employee unreasonably fails to take advantage of an employer’s anti-harassment policy and remedial procedures by verbally reporting harassment when the employer’s policy requires a written complaint. The lower court decisions in this case suggested the failure of Aguas to submit a complaint in writing, in accordance with the State employer’s policy, was fatal to her claim. Therefore, if this issue is addressed on remand, there will be significant consequences for reporting and remediating claims of sexual harassment under the LAD. 

Employers should regularly review their policies and practices with employment counsel to ensure they address specific organizational needs effectively and comply with applicable law.