New Jersey Supreme Court Expands Employer’s LAD And Worker’s Compensation Liability In LAD/WC Decision

In an almost 50 page decision decided June 8, 2021, Justice Jaynee LaVecchia, writing for a unanimous Court, expanded workers compensation liability for employers in a case involving an employer’s failure to accommodate an employee’s disability under the Law Against Discrimination (LAD).  This decision should serve as a warning and a wake-up call to employers facing an employee’s reasonable request for an accommodation, as the holdings regarding the claim under the LAD have a direct bearing not only on failure to accommodate cases under the LAD but also on workers compensation issues. The facts of the case are essential to an understanding of the Court’s holding. However, employers, their legal representatives and insurance professionals should read the entire decision to understand how a simple accommodation can avoid the problems discussed.

In Mary Richter v. Oakland Board of Education, (A-23-19), the plaintiff, a longtime type-1 diabetic, was a science teacher in the Oakland school district. At the start of the 2012-2013 school year she was assigned a late lunch during the seventh period starting at 1:05 p.m. Fearing that not eating her lunch until this late time would adversely affect her blood sugar levels, she more than once requested her principal to change her lunch to a period beginning at 11:31 a.m. Despite his assurances he would “look into it” the principal did not alter her schedule during the first marking period, requiring her to eat glucose tablets to maintain her blood sugar. For the second marking period she was given the early lunch schedule she had previously requested, but for the third marking period she was again assigned to the 1:05 p.m. lunch. Despite her again requesting a change from the late lunch period, which the principal acknowledged was a mistake, to the earlier lunch period, no change to her scheduled lunch period was made. The principal suggested ways she could address her blood sugar levels while keeping the late lunch, but when she asked the principal to put these instructions in writing he refused. As a result, her blood sugar levels often fell below the normal range by the end of sixth period.

On Tuesday, March 5, 2013, near the end of sixth period she suffered a hypoglycemic event in front of her students. She had a seizure, lost consciousness and struck her head on a lab table and the floor. As the result of this fall she suffered serious injuries. She filed a Claim Petition for workers compensation benefits and was ultimately awarded 33 1/3% partial permanent disability, equaling $77,200.00.

Richter also filed a tort action against the Board of Education and the principal individually. Defendants moved for summary judgement on the basis of the NJ Workers Compensation Act’s (WCA) exclusive remedy provision, NJSA 34:15-8. The motion judge held that her claim was not barred under the WCA and denied the motion. Thereafter, a second motion for summary judgement was filed, this time on the grounds that she did not have a prima facie LAD claim because she suffered no adverse employment action; Richter filed a cross motion arguing she did suffer an adverse action. The motion to dismiss under the WCA was also refiled, or in the alternative for a 100% credit for the compensation award already paid. These motions were heard by a different motion judge who granted defendant’s motion for summary judgement and denied plaintiff’s motion, determining that she did not suffer an adverse employment action because she was not fired or reassigned to another position, and was therefore unable to establish a failure to accommodate claim. Both parties appealed and in a reported decision the Appellate Division reversed the grant of the defendant’s summary judgement motion and affirmed the denial of plaintiff’s summary judgement motion, remanding both for trial. Richter v Oakland Bd. of Educ., 459 N.J. Super. 400 (App. Div. 2019) Thereafter the matter was heard by the Supreme Court.

The Supreme Court took this opportunity to address the unsettled issues of whether a failure to accommodate claim requires an adverse employment action and whether the exclusive remedy doctrine of the WCA bared Richter’s claim under the LAD. The Court resolved both issues in the negative.

With respect to the accommodation issue, the Court held that a failure to accommodate claim under the LAD does not require a plaintiff to plead and demonstrate an adverse employment consequence as an element of a prima facie action.  Noting that the legislature’s stated intent in the LAD is to eradicate discrimination and make the workplace hospitable for persons with disabilities the Court reasoned: “To best implement that legislative intent, we conclude that an employer’s inaction, silence, or inadequate response to a reasonable accommodation request is an omission that can give rise to a cause of action.”

With respect to the exclusive remedy doctrine of the WCA the Court noted the intent of the legislature in enacting the LAD was to reinforce that the LAD supplements the common law and to make common law remedies available to employees who were victims of unlawful discrimination. To allow the WCA’s exclusivity provision to bar the accommodation claims of petitioner and those similarly situated would fly in the face of the intent of the legislature. The court therefore held that Richter has a right to pursue her LAD claims and remedies.

Finally, the Court addressed the issue of the potential for a double recovery from Richter’s LAD claim and her WCA award, the Court cited the WCA provisions allowing a credit for compensation benefits paid and provided against third party recoveries. Recognizing the need to avoid a double recovery, the Court, while rejecting the request of a 100%, dollar for dollar credit, held that the provisions of NJSA 34:15-40 would apply, permitting a credit as per statute.

Clearly the Court has expanded employer liability in this decision. It has expanded the opportunity for employees to assert LAD claims for failure to accommodate where the employer has merely failed to act; it is not necessary for an employer to affirmatively take a negative action against the employee. A simple inaction, as here, may now be sufficient. It further expanded employer liability by holding that the exclusive remedy provision of the WCA does not bar such a claim. So now employers are faced not just with the prospect of increased failure to accommodate claims but without the possibility of defending based on the exclusive remedy doctrine.

Employers should be acutely aware of the need to address every request for an accommodation with priority. Obviously, the protocols for dealing with such requests will vary for different situations. But the implications of this decision by the Court should be immediately considered by every employer covered by the LAD.

By:  Alfred P. Vitarelli, Associate at Brown & Connery, LLP