Articles Posted in Employment Discrimination

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Discrimination based on gender identity or gender expression has received a large amount of attention, partly due to advances made by advocates for transgender and gender non-conforming individuals in the workplace and elsewhere. It is also due to pushback against those advances. New Jersey employment law specifically bars discrimination based on gender identity and gender expression, while federal law treats it as a form of sex discrimination. The use of restrooms in the workplace has been a topic of particular controversy in recent weeks due to a dispute involving the first openly transgender woman elected to Congress. New Jersey law generally states that employers must allow bathroom use based on individual gender identity.

The Occupational Safety and Health Administration (OSHA) requires “lavatories…in all places of employment,” with only a few exceptions. Employers may have restrooms separated by sex or unisex restrooms. OSHA regulations are primarily concerned with sanitation and employee health, although the agency offers guidance on gender identity issues.

The New Jersey Law Against Discrimination (NJLAD) states that employers may not discriminate against employees or job applicants “because of [their]…gender identity or expression.” The New Jersey Attorney General’s Division on Civil Rights interprets this provision to include “us[ing] a bathroom or changing room consistent with [an individual’s] gender identity or expression.” The state government’s policy on individuals who are transitioning their gender identity or expression includes a provision on restroom access, which requires state employers to provide “the same level of restroom access available to non-transgender individuals.”
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Disparities in wages and salaries remain a pernicious form of employment discrimination. According to the Pew Research Center, the nationwide gender pay gap only improved by 2% from 2002 to 2022. Women, on average, earned $0.80 for every $1 men earned in 2002, and $0.82 per $1 two decades later. These disparities can be much more pronounced when other factors, such as race, are taken into account. Both federal and New Jersey employment laws are working to address the issue, but it remains an issue. Lilly Ledbetter became an unintentional pioneer in this fight when Congress passed a law named after her that helps employees prove pay discrimination in court. Mrs. Ledbetter passed away at the age of 86 on October 12, 2024. In honor of her contributions to the battle for pay equity, we offer this review of her impact on federal pay discrimination law.

Several federal statutes address pay discrimination. The Equal Pay Act (EPA) of 1963 amended the minimum wage section of the Fair Labor Standards Act (FLSA). It applies specifically to gender-based disparities in pay for equal work, treating them as minimum wage and overtime violations.

Title VII of the Civil Rights Act of 1964 covers discrimination “with respect to…compensation” based on race, sex, religion, color, and national origin. Section 706(e) of the statute states that an employee must file a charge within 180 days of an alleged discriminatory practice. This makes sense when the employee is aware of the discriminatory practice at or near the time it occurs, such as in many cases involving sexual harassment or wrongful termination. Pay discrimination can be much harder to identify. This is where Lilly Ledbetter enters the story.
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Disparities in wages and salaries remain a major form of workplace discrimination. New Jersey employment laws have tried to address this issue, but it can be difficult to identify wage discrimination, especially when employers attempt to prevent discussion about wages and salaries. The New Jersey Legislature passed a law in September 2024 that requires pay transparency. Covered employers will be required to include wage or salary information in job postings and announcements for transfer opportunities. The law does not allow employees to file lawsuits for violations, but it does impose civil penalties. It will take effect on June 1, 2025.

The pay transparency law applies to New Jersey employers with at least ten employees over at least twenty weeks in a year. Its definition of “employer” is fairly broad. Employment agencies and job placement agencies fall under the definition if they meet the minimum employee requirement.

The law sets two main requirements for covered employers. The first involves the disclosure of pay in postings for “new jobs and transfer opportunities.” It applies to both external postings, such as those posted on job search websites and other resources, and postings made internally within the company. Postings must include:
– The hourly wage or salary for the job, or the wage or salary range; and
– A “general description” of benefits and other compensation for which an employee would be eligible in the listed job.
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The Americans with Disabilities Act (ADA) of 1990 protects workers against discrimination because of injuries, illnesses, and other conditions that impair their daily lives. The statute prohibits employers from discrimination based on disability and requires them to provide reasonable accommodations to help employees with disabilities perform their jobs. Compliance with the ADA often requires careful consideration of employees’ needs on a case-by-case basis. The Equal Employment Opportunity Commission (EEOC) has addressed concerns about employers’ use of artificial intelligence (AI) systems to handle various tasks once left to human employees. The agency has identified areas of concern where an AI system could lead to ADA violations.

Protections Under the ADA

An employer may not “discriminate against a qualified individual on the basis of disability” in matters like hiring, promotions, termination and layoffs, compensation, and other aspects of employment. The ADA prohibits “medical examinations and inquiries” intended to assess whether an individual has a covered disability, or the extent of such a disability.

The statute imposes an obligation on employers to make reasonable accommodations for “the known physical or mental limitations” of an employee or job applicant who is otherwise able to perform their job duties. The only exception is when an employer can show that an accommodation “would impose an undue hardship” on the employer’s business. Accommodations that have been deemed “reasonable” include wheelchair access, flexible scheduling, and reading assistance for employees with visual impairments.
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Both private and public employers have obligations to their employees under New Jersey employment laws. These include obligations to pay a minimum wage and to maintain a workplace reasonably free from discrimination and harassment. Public employers, such as state and local agencies and officials, may also have a duty to respect their employees’ constitutional rights. An employee who believes their employer has discriminated against them because of their religion can bring a claim under a state or federal employment statute. If they work for a public employer, they may also be able to claim a violation of their First Amendment right to freedom of religion. The Third Circuit Court of Appeals, whose jurisdiction includes New Jersey, recently ruled in favor of an employee’s religious discrimination claim. Rather than suing under an employment statute, the employee alleged violations of the First Amendment’s Free Exercise Clause.

Public employees may be able to assert claims against their employers for violations of certain constitutional rights. Many claims rely on 42 U.S.C. § 1983, which allows a person to sue for deprivation of constitutional rights for actions taken “under color of any statute” or other law. Section 1983 claims are common in a wide variety of incidents involving government officials or agencies, from police brutality to employment discrimination.

It is also possible to allege a constitutional violation directly as a cause of action. These types of claims often involve First Amendment rights. For example, public employers do not have as much leeway to restrict their employees’ speech as private employers do. Public employees may be able to assert claims involving violations of their rights to free speech, freedom of religion, or other rights under the First Amendment.
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Employment discrimination on the basis of factors like race, religion, sex, sexual orientation, gender identity, and disability is unlawful under New Jersey employment law. Broadly speaking, courts have identified two types of unlawful employment discrimination: discriminatory intent and disparate impact. Cases based on discriminatory intent often involve overt bias. In disparate impact cases, an employer may violate the law if their policy or practice has an outsized adverse impact on a protected group, even if it appears outwardly neutral. A group of federal agencies developed a guideline several decades ago, known as the Four-Fifths Rule, for determining when a policy or practice has too much of a disparate impact on a protected group. While this rule significantly predates the current use of artificial intelligence (AI) in employment, it provides a useful guide for assessing when an AI tool might violate employment laws.

Title VII of the Civil Rights Act of 1964 is the main federal statute dealing with employment discrimination. It mentions five protected categories by name: race, sex, religion, color, and national origin. Congress amended the statute in 1978 to add discrimination based on pregnancy and childbirth to the definition of sex discrimination. The U.S. Supreme Court has held that sex discrimination includes discrimination based on sexual orientation and gender identity.

The Four-Fifths Rule is based on uniform guidelines developed by four federal agencies in 1978: the Equal Employment Opportunity Commission (EEOC), the Civil Service Commission, the Department Of Labor, and the Department of Justice. Although it includes the word “rule,” the Four-Fifths Rule is more like a guideline that provides an idea of when an employment practice might run afoul of the law.
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In a recent ruling, the Third Circuit upheld a summary judgment in favor of Bryn Mawr Trust Company (BMT) in a lawsuit filed by former employee, Russo. Russo, who is Black, alleged that her supervisor, Therese Trainer, subjected her to racial discrimination, retaliation, and a hostile work environment. Ultimately, the court rejected Russo’s claims against her former employer; however, the case provides important insight to similarly situated employees who are looking to learn more about their options.

The Court Rejects Each of the Plaintiff’s Claims

The court reviewed Russo’s claims under the McDonnell Douglas burden-shifting framework. While Russo established a prima facie case of discrimination by highlighting several instances of inappropriate comments and perceived hostile actions by Trainer, the court found that BMT provided legitimate, non-discriminatory reasons for its actions. Specifically, the court noted that the security investigation into Russo’s handling of a vault key, which led to her suspension with pay, was justified given the seriousness of the breach. Additionally, the court determined that Russo’s claim of constructive discharge—stemming from BMT’s decision to give a hostile customer 30 days to close her account—did not hold up under legal scrutiny. The court concluded that BMT’s response was consistent with its standard procedures and did not create an environment so intolerable that a reasonable person would feel compelled to resign.

The court also dismissed Russo’s retaliation claims, emphasizing that the security investigation was initiated before Russo filed her EEOC and PHRC complaints, making it unlikely to be retaliatory. The court further found that BMT’s handling of the hostile customer incident was prompt and appropriate, undermining Russo’s claims of retaliation.

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A new rule from the Equal Employment Opportunity Commission (EEOC) seeks to implement the Pregnant Workers Fairness Act (PWFA), but it has faced opposition. The PWFA fills an important gap in federal pregnancy discrimination law. New Jersey employment law has long required employers to provide reasonable accommodations for workers who are pregnant, have recently given birth, or are dealing with medical conditions related to either pregnancy or childbirth. Federal law did not have this requirement, except for a possible interpretation of the Americans with Disabilities Act (ADA). The PWFA expressly requires reasonable accommodations in these circumstances. Several state attorneys general filed suit against the EEOC to blog the new PWFA rule based on the EEOC’s inclusion of abortion and related services. A federal court dismissed the lawsuit in June 2024, finding that the plaintiffs lacked standing to sue. That lawsuit, however, is not the only challenge to the rule.

The PWFA took effect on June 27, 2023. The EEOC published its rule implementing the PWFA in the Federal Register on April 19, 2024. The rule broadly interprets the PWFA’s requirement that employers provide reasonable accommodations based on “pregnancy, childbirth, and related medical conditions.” It is similar to the ADA’s reasonable accommodations process, with some important differences. The rule places a fairly heavy burden on employers to accommodate workers’ needs.

Seventeen state attorneys general filed suit against the EEOC on April 25. They sought an injunction preventing the PWFA rule from taking effect. Much of their objections stemmed from the inclusion of abortion in the rule’s definition of “pregnancy, childbirth, or related medical conditions.” The rule would require employers to make reasonable accommodations for employees who have the procedure or are dealing with complications related to the procedure.
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Federal and New Jersey employment laws protect workers from discrimination on the basis of factors like race, sex, and religion. State law includes more protected categories than federal law, but both statutes give rather broad authority to government agencies to investigate alleged unlawful practices by employers. At the federal level, Title VII of the Civil Rights Act of 1964 authorizes the Equal Employment Opportunity Commission (EEOC) to pursue enforcement actions directly or give employees approval to file civil lawsuits. The statute directs certain employers to file reports with the EEOC containing demographic data about their employees. The agency recently filed lawsuits against at least fifteen employers, including two in New Jersey, for failing to file these reports on time. It settled both New Jersey lawsuits within a few weeks of filing.

Section 709(c) of Title VII and EEOC regulations require employers with one hundred or more employees to file annual reports regarding the gender and race/ethnicity of their workforces. The EEOC states that it uses the data in these reports to assist in enforcement and research activities.

The EEOC does not require employers to keep records in any specific form. It does, however, require covered employers to use a form known as the EEO-1 Component 1 data report to submit demographic information. EEOC regulations note that employers’ recordkeeping practices should comply with other state and federal laws regarding discrimination and employee privacy.
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The U.S. Supreme Court issued a ruling in April 2024 that addresses an important question about what plaintiffs must prove in employment discrimination claims. Federal and New Jersey employment laws do not expressly state that a plaintiff alleging discrimination must prove that they suffered significant harm. Many courts, however, have interpreted antidiscrimination laws as requiring this kind of proof. The Supreme Court’s ruling in Muldrow v. City of St. Louis overturned multiple lower court precedents applying this interpretation to Title VII of the Civil Rights Act of 1964. It held that a discriminatory job transfer is unlawful even without evidence of a “materially significant disadvantage.”

Section 703(a)(1) of Title VII deals with unlawful employment discrimination. It mentions acts like “fail[ing[ or refus[ing] to hire” a person and “limit[ing], segregat[ing], or classify[ing]” employees in discriminatory ways. It does not specifically state that a discriminatory employment action must cause harm to the person experiencing the discrimination. Before Muldrow, many courts had interpreted this provision as requiring proof of harm in at least some cases. This includes courts in New Jersey.

The Third Circuit Court of Appeals has held that Title VII discrimination claims involving “adverse employment actions” require proof of a “cognizable injury.” The injury must be serious enough to alter the “terms, conditions, or privileges of employment.” In the 1997 decision establishing this rule, the court held that “unnecessary derogatory comments” made toward the plaintiff did not rise to this level. Refusal to recommend the plaintiff for a promotion based on discriminatory grounds, however, would meet the standard. Muldrow may overturn the Third Circuit’s rule.
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