NJ Supreme Court Clarifies Employee 'Protected Activity'

The ruling provides guidance as to what employee conduct is protected under the antiretaliation provisions of two key state laws.

On July 17, the Supreme Court of New Jersey issued a decision in Battaglia v. United Parcel Service, Inc.,1 providing guidance as to what employee conduct constitutes "protected activity" under the antiretaliation provisions of two key state laws—the New Jersey Law Against Discrimination (LAD) and the Conscientious Employee Protection Act (CEPA). First, the court held that an employee complaint relating to conduct that the employee reasonably believes violates company policy in the form of sex discrimination is protected from retaliation by the LAD even if the complaint did not concern "directly demonstrable acts of discrimination." Second, an employee claiming retaliation under CEPA cannot base his or her claim on complaints about minor violations of company policy. The court also ruled that claims for future emotional distress must be supported by competent evidence of permanency.

Background

The plaintiff, Michael Battaglia, alleged that United Parcel Service, Inc. (UPS) demoted him in October 2005 in retaliation for complaining about his supervisor's use of crude sexual language when referring to female employees and rumors that his supervisor was having an affair with a female manager. Battaglia also alleged that he was demoted in retaliation for reporting improprieties with respect to credit card usage, specifically that one or more managers "were going out for liquid lunches and abusing the UPS credit card" and not returning to work. Shortly before his demotion, Battaglia allegedly raised these complaints with his supervisor and vaguely referenced "ethical" issues in an anonymous letter he sent to a human resources manager.

In February 2009, a jury in the Superior Court of New Jersey, Law Division, Middlesex County, found UPS liable for unlawful retaliation in violation of both the LAD and CEPA. The jury awarded Battaglia $1 million—$500,000 in economic damages and another $500,000 for emotional distress. The emotional distress award was partially based on Battaglia's alleged future emotional injuries. The trial court rejected UPS's motion to overturn the jury's liability verdict but reduced the emotional distress damages award to $205,000. UPS appealed, and Battaglia cross-appealed, to the Superior Court of New Jersey, Appellate Division.

Appellate Division Decision

In August 2011, the Appellate Division...