The New Jersey Supreme Court Addresses 'Reasonable Accommodation' and Prejudgment Interest in LAD Cases

In a recent decision, in a case where the plaintiff alleged that his employer terminated his employment in violation of the New Jersey Law Against Discrimination, N.J.S.A. § 10:5-1 et seq. (the LAD) because it failed to accommodate his disability, the New Jersey Supreme Court reversed the trial court’s directed verdict in plaintiff’s favor on the reasonable accommodation issue. The Court also for the first time addressed the availability of prejudgment interest in LAD cases. See Potente v. County of Hudson, ___ N.J. ___, 2006 WL 1585413 (June 6, 2006).

The Facts

Plaintiff was injured in an automobile accident while on duty as an investigator in the Hudson County Prosecutor’s Office. He was cleared to work six hours a day, accompanied by two hours of daily therapy. Because his injuries left him unqualified to use a weapon, he was assigned to the radio room for three weeks. Later, plaintiff was transferred to full-time duty in the domestic violence section, which required no field work, until he took sick leave to undergo shoulder surgery. Plaintiff expected to return to work in six to eight weeks, and after his accrued compensatory and sick time were exhausted he applied for state disability benefits. Plaintiff testified that during his recovery period he requested positions involving light duty but was repeatedly told that no such positions were available.

Plaintiff then requested from his direct supervisor, James Hoppes, a leave of absence due to the shoulder surgery and continuing therapy. Hoppes advised him in writing that he needed to provide a more detailed account of his injuries and treatment within 5 days. On the fifth day, plaintiff sent a memorandum to Hoppes and to Robert Martin, his ultimate supervisor “explaining his injury and suggesting that his treating physician could be contacted for further clarification.” On the following day, via a hand-delivered letter, Martin denied plaintiff’s request for leave because it was “unspecified.” Plaintiff was instructed to report to work on the following day and told that “[f]ailure to comply with this directive will result in disciplinary action.” Upon receipt of Martin’s letter, plaintiff contacted Hoppes, Kevin Wilder, plaintiff’s union president; and John Bigger, an investigator involved with the union. The evidence of the respective parties differed dramatically as to what next occurred.

According to the County of Hudson, Bigger contacted Martin who agreed to a sit-down meeting with plaintiff and Bigger on the following day to discuss “what kind of accommodations we can reach here … and that may include going after another leave of absence.” Bigger told Martin that “[w]e’ll walk [plaintiff] through it.” Martin agreed to the meting provided that plaintiff report to work on that day. Both Bigger and Wilder telephoned plaintiff to tell him that the meeting had been arranged. Bigger allegedly told plaintiff:, “You’re going to have to come in and we’re going to try to work out some accommodations here because your days have run out and at least you can get a pay check out of this deal. You know, come in and we’ll find something or if there’s going to be a point where you can’t-you know, if it’s something that you can’t do anything maybe, we’ll try to work to get another leave of absence, you know, we’ll try another, you know, a route there.” According to the County of Hudson, the meeting was to have dealt with: “(1) potential accommodations, including a leave of absence; (2) plaintiff’s medical condition; (3) making arrangements so that plaintiff could “fill out the paperwork in the handbook to apply appropriately for unpaid leave of absence”; (4) the fact that plaintiff had exhausted all of his vacation and sick time; (5) the fact that plaintiff’s earlier requests for leave were not specific; and (6) how to classify plaintiff.” Bigger also spoke to the union’s labor attorney, who recommended that plaintiff return to work and Bigger advised plaintiff of that recommendation. Around 11:00 p.m. that evening, however, plaintiff told Bigger by phone “that he was not going to come in for the meeting because his own counsel had advised him that coming in would ‘mess up his disability case.'” Even so, Bigger called plaintiff on the morning of the meeting to tell him that it was not too late to come in, but plaintiff only repeated what his attorney had said.

According to plaintiff, however, no meeting was ever discussed. Instead of reporting to work as instructed by Martin, plaintiff faxed a letter to the County of Hudson requesting family leave for 15 days. In response, Martin informed plaintiff that he did not qualify under the federal Family and Medical Leave Act or the New Jersey Family Leave Act. Seven days later, Hoppes hand-delivered a letter to plaintiff, informing him that he had been terminated because he was “absent without leave or permission….”

Plaintiff filed a complaint in federal court against the County of Hudson, the Prosecutor’s Office and Martin. That complaint was eventually dismissed and refiled in state court where it was tried to a jury against the County of Hudson as the only defendant. Plaintiff alleged that the County failed to accommodate his disability in violation of the LAD. At the end of defendant’s case, the trial judge granted plaintiff’s motion for a directed verdict with respect to liability based on failure to accommodate. The issuer of damages went to the jury, which awarded plaintiff $200,000 in back pay and $50,000 in pain and suffering. In addition to attorneys fees, the trial court awarded plaintiff both pre- and post-judgment interest.

The Supreme Court’s Decision

The Supreme Court noted that the LAD’s reasonable accommodation requirement is set forth in the administrative regulations implementing the statute rather then in the express language of the statute itself. “In brief, unless it would impose an undue hardship on the operation of the business, N.J.A.C. 13:13-2.5(b) requires an employer to make a ‘reasonable accommodation to the limitations of an employee … who is a person with a disability.’ However, an employer is not required to take action ‘where it can reasonably be determined that an ??? employee, as a result of the individual’s disability, cannot perform the essential function of the job even with reasonable accommodation.’ N.J.A.C. 13:13-2.8(a).”

The Court ruled that the trial court improvidently granted a directed verdict in favor of the plaintiff on the employer’s alleged failure to reasonable accommodate his disability because, based on all of the evidence “reasonable minds could differ regarding whether defendant was willing to accommodate plaintiff.” The Court cited to the evidence presented by the defendant demonstrating its efforts to attempt to discuss accommodations with plaintiff and plaintiff’s resistance to those efforts. This evidence presented a jury question because “[p]lainly, an employee cannot refuse to cooperate with an employer’s efforts to accommodate his disability and then claim failure to accommodate.” Thus the Court concluded that defendant was entitled to a new trial.

The Court also focused on the trial court’s award of prejudgment interest, an issue it had not addressed previously. The Court noted that Court Rule 4:42-11(b), which governs prejudgment interest, and which was adopted in 1972, eliminated the prior distinction the courts had made between liquidated and unliquidated claims for purposes of prejudgment interest. Under the Rule, prejudgment interest is an available remedy in common law tort actions generally, a remedy which, according to the Court, serves the salutary purpose of promoting settlement. Thus, “when the LAD was amended to allow ‘[a]ll remedies available in common law tort actions,’ N.J.S.A. 10:5-13, pre-judgment interest was an available remedy under the LAD.”

Conclusion

The Court’s decision serves as an example of the importance employers should place on efforts to reach reasonable accommodations with their disabled employees who request accommodations. In the case at hand, it was the evidence of such efforts that resulted in a reversal of the directed verdict in plaintiff’s favor and that, if credited by a jury, would result in a verdict for the employer.

Employers must now also give serious consideration to the issue of prejudgment interest in LAD cases. As result of the Court’s decision, plaintiff’s will undoubtedly make prejudgment interest a component of any settlement demand, and employers will need to take this factor into account in determining an appropriate settlement figure versus the risk of a plaintiff’s verdict at trial.