Boon To New Jersey Employers: State Supreme Court Confirms That Federal Faragher/Ellerth 'Affirmative Defense' Now Applies To Sexual Harassment Claims Under State Law

Executive Summary: On February 11, 2015, New Jersey's Supreme Court formally decided an important issue left open for nearly two decades concerning New Jersey's Law Against Discrimination (LAD). In Aguas v. State of New Jersey, __ N.J. __, No. 072467 (2015), the state's highest court definitively held that an employer can rely upon the company's anti-harassment policy as an "affirmative defense" to an employee's claims of negligence or vicarious liability brought under the LAD. In doing so, the Court aligns the standard for employer liability under the LAD with that set forth by the U.S. Supreme Court in its landmark 1998 decisions, Faragher v. City of Boca Raton and Burlington Indus. v. Ellerth. A copy of the decision is available here.

The key issue in Aguas centered on efforts made by New Jersey's Department of Corrections (DOC) to prohibit workplace discrimination and harassment. The DOC instituted a comprehensive written anti-discrimination policy and mandated training on the policy for all employees. Plaintiff Aguas, a corrections officer, alleged that she was sexually harassed on several occasions by two different officers. The DOC's Equal Employment Division (EED) advised Aguas that it had initiated an investigation of her verbal complaint of sexual harassment. After several weeks and 20 interviews, the EED investigator ultimately concluded that Aguas's allegations were unsubstantiated. Only two days after the EED began its investigation, however, Aguas filed her lawsuit alleging that the two officers subjected her to a hostile work environment based on her gender, and that the state retaliated against her because of her objections to that harassment, in violation of the LAD.

The trial court granted summary judgment to the state, holding that though Aguas presented a prima facie showing of sexual harassment and a hostile work environment, the state established an affirmative defense that the DOC's policy provided a legitimate complaint procedure that Aguas ignored. An Appellate Division panel affirmed the trial court's grant of summary judgment, agreeing that the state had established an affirmative defense.

Upon review, the New Jersey Supreme Court confirmed that the scope and legitimacy of DOC's anti-harassment policy must be central to the determination of Aguas' claims for liability under the LAD and applied this finding to claims brought under both theories of negligence/recklessness and of vicarious liability for supervisory...