On August 9, 2004, in Tarr v. Ciasulli, the New Jersey Supreme Court ruled that victims of workplace sexual harassment who seek emotional distress damages under the New Jersey Law Against Discrimination (“LAD”) should be held to a “far less stringent standard of proof” than that required for a tort-based intentional infliction of emotional distress claim. In contrast to the tort standard, which requires a plaintiff to demonstrate a severe emotional or physical ailment, a plaintiff's testimony of temporary humiliation is sufficient for a LAD emotional distress claim to reach a jury. On the issue of individual liability, the Court found the negligent supervision of employees insufficient to impose individual liability upon a business owner. With respect to attorneys' fees, the Court held that a party who prevails on a claim and is awarded “some relief” is entitled to attorneys' fees.
Background
Carol Tarr, who worked for Mack Auto Mall on two separate occasions and who resigned each time because of alleged sexual harassment, testified at trial that one employee left pornographic material on his desk, drew sexually explicit pictures on envelopes, opened his legs, described his sexual organ in detail and related his sexual adventures with very young women. Another employee allegedly told plaintiff repeatedly of his desire to have a sexual encounter with her, and asked her to have sex with him in a broom closet. A third employee “made offensive sexual comments to her in the presence of strangers, intimating that his presence would sexually stimulate her.” According to plaintiff's testimony, she regularly cried on her way home from work, was constantly embarrassed, and “often wanted to crawl under her desk.”
The trial court dismissed plaintiff's claim for emotional distress damages, because she failed to demonstrate that she sustained any severe physical or emotional ailments. The Appellate Division reversed, rejecting the notion that a plaintiff must demonstrate the same proof of emotional distress under LAD as required to sustain a tort claim. According to the appeals panel, it was of little consequence that the plaintiff did not suffer extreme distress, did not seek the care of a mental health practitioner and offered no expert testimony.
Emotional Distress Damages
Upholding the Appellate Court's decision, the Supreme Court, based on its analysis of a 1990 amendment to LAD authorizing the recovery of emotional distress damages, reasoned that limiting emotional distress damages to cases in which a plaintiff suffered serious psychological harm was contrary to LAD's remedial purpose.
The Court explained that since discrimination cases always involve intentional conduct, plaintiffs can recover “all natural consequences of that wrongful conduct, including emotional distress and mental anguish damages arising out of embarrassment, humiliation and other intangible injuries.” While relevant to the quantum of compensation, the duration, content, public nature and severity of the harassment may not preclude the recovery of emotional distress damages.
Individual Liability
While the Court ruled for the plaintiff with respect to her emotional distress damages, it found that she failed to establish that the owner of the business was individually liable for the harassment. To establish individual liability, an individual defendant must “aid and abet” the employees in the sexual harassment of a plaintiff. In other words, the individual must knowingly give substantial assistance or encouragement to the unlawful conduct of the employer. The factors to consider in determining whether a defendant provides “substantial assistance” to the principal violator are: (1) the nature of the act encouraged; (2) the amount of assistance given by the individual; (3) whether the individual was present at the time of the asserted harassment; (4) the individual's relations to the others; and (5) the state of mind of the individual.
Applying this standard to the facts in Tarr, the Court concluded that plaintiff failed to present evidence that the owner encouraged any of the wrongful conduct against plaintiff, that he assisted the wrongdoers, or that he was even present when the wrongful conduct occurred. The Court noted that, at most, he negligently supervised his employees, which is insufficient to establish individual liability.
Attorneys' Fees
With respect to attorneys' fees, the New Jersey Supreme Court held that an award of “some relief,” whether in court or through a settlement or consent degree, may entitle a party to reasonable attorneys fees. An award of nominal damages when no losses are actually suffered may also be sufficient for a plaintiff to recover such fees under LAD; however, the trial court retains discretion on whether to award minimal fees or no fees at all.
The Significance of Tarr
In light of Tarr, New Jersey-based employers should be aware that if a plaintiff can prove sexual harassment, a jury will likely be given the opportunity to award emotional distress damages. Accordingly, employers should review their current anti-harassment and discrimination policies to ensure that all internal complaints are promptly and effectively handled. Employers should also continue to provide comprehensive harassment training for all of their employees.
Employers should be comforted by knowing, however, that negligent supervision alone will not give rise to individual liability. Nevertheless, an employee can still establish individual liability under LAD if he/she can satisfy the “aiding and abetting” standards enunciated in Tarr.
The ability of plaintiffs to recover attorneys' fees even if they are awarded only nominal damages may result in an increase in the number of discrimination lawsuits. Because the Court specifically mentioned attorneys' fees with regard to settlement and consent decrees, it is imperative that any settlement agreement which an employer concludes with an alleged discriminatee specifically address whether attorneys' fees are covered, in order to avoid the risk of a later application by the individual to a court for an award of fees in excess of the agreement's settlement proceeds.
Jessica S. Boar is an Associate in Littler Mendelson's Newark, NJ, office. If you would like further information, please contact your Littler attorney at 1.888.Littler, info@littler.com, or Ms. Boar at jboar@littler.com.