Burden For Sexual Harassment Plaintiffs To Obtain Emotional Distress Damages, Impose Individual Liability, And Have Plaintiff's Attorney's Fees Awarded

Monday, November 1, 2004 - 00:00

On August 9, 2004, in Tarr v. Ciasulli, the New Jersey Supreme Court released its ruling on the first case in the state to determine the meaning of "aiding and abetting" with regard to individual employee liability under the New Jersey Law Against Discrimination ("NJLAD"). The Court ruled on the following three issues:

(1) the level of proof required for an employee to recover emotional distress damages under the NJLAD;

(2) what it means for another employee to "aid" or "abet" the harassment of a complainant such that the other employee himself will be held individually liable; and

(3) when attorney's fees will be awarded to a prevailing employee.

In Tarr, the plaintiff worked as a finance and insurance manager for an auto dealer for approximately one year and then resigned, alleging that she had experienced sexual harassment in the workplace. At trial, the plaintiff testified that a group of male employees had subjected her to extensive and pervasive sexual harassment. She further testified that the general manager made inappropriate comments to her on more than one occasion and had heard much of the other comments at issue, but had made no effort to stop it. With respect to her claim for emotional distress damages, the plaintiff testified that she had experienced mental anguish, embarrassment, humiliation, and other intangible injuries.

Compensatory Damages For Emotional Distress

The Tarr Court held that in discrimination cases, a successful plaintiff may recover all natural consequences of the wrongful conduct, including emotional distress and mental anguish damages arising out of embarrassment, humiliation, indignity and other intangible injuries without limitation to severe emotional or physical ailments. The Court imposed a far less stringent standard of proof for compensatory damages for emotional distress resulting from willful discriminatory conduct than that which is required for a tort-based emotional distress cause of action.

In 1990, the Legislature amended the NJLAD to authorize recovery of emotional distress damages for discrimination claims. Following that amendment, the New Jersey Supreme Court affirmed an award to an employee for emotional distress damages under the NJLAD where the employee detailed her inconvenience and economic loss, physical and emotional stress, anxiety in searching for re-employment, uncertainty, career and family disruption, and other adjustment problems, despite the absence of expert testimony or independent corroborative evidence. Federal courts have reached the same conclusion under federal statutes with respect to emotional distress damages. Both state and federal courts have recognized claims for emotional distress of varying degrees where the wrongful conduct is "willful," as opposed to "negligent."

In support of its recent holding in Tarr, the Court relied on this NJLAD amendment and reiterated that the NJLAD expressly reflects the public policy interest in protecting "the civil rights of individual aggrieved employees [and protection of] the public's strong interest in a discrimination-free workplace." With respect to the amount of compensation to be awarded for emotional distress, the Court indicated that trial courts should consider the following factors:

(a) the duration of the discriminatory conduct;

(b) its public nature; and

(c) its content.

The Court also advised that an award may be enhanced by such additional proofs of indicia of suffering.

Individual Liability

Under the NJLAD, it is unlawful "[f]or any person, whether an employer or an employee, to aid, abet, incite, compel or coerce the doing of any of the acts forbidden [under the NJLAD]." To hold an employee liable under the NJLAD as an "aider" or "abettor," a plaintiff must show that:

(a) the party who the defendant aids performed a wrongful act that caused an injury;

(b) the defendant must be generally aware of his role as part of an overall illegal or tortious activity at the time that he provides the assistance; and

(c) the defendant must knowingly and substantially assist the principal violation.

In essence, an employee will be held individually liable if he or she "knows that the other's conduct constitutes a breach of duty and gives substantial assistance or encouragement to the otherÉ" Courts will look to the following five factors to assess whether a defendant provides substantial assistance:

(a) the nature of the act encouraged;

(b) the amount of assistance given by the supervisor;

(c) whether the supervisor was present at the time of the asserted harassment;

(d) the supervisor's relations to the others; and

(e) the supervisor's state of mind.

In Tarr, the Court held that the evidence was insufficient to hold the general manager individually liable under the NJLAD because there was no evidence that he had encouraged any of the wrongful conduct against the plaintiff; had assisted the wrongdoers; or was even present when the alleged wrongful conduct had occurred. The Court held that, at best, the owner had supervised his employees negligently, which did not meet the standard to hold him individually liable.

Attorney's Fees Award

Under the NJLAD, a "prevailing party" may be awarded a reasonable attorney's fee. The Tarr Court ruled that a plaintiff who is awarded some affirmative relief by way of an enforceable judgment against the defendant or other comparable relief through a settlement or consent decree is a prevailing party under the NJLAD. In other words, a plaintiff who receives only nominal damages is still deemed to be a prevailing party in the context of awarding attorney's fees. However, in the case of a nominal damages award, it is at the trial court's discretion whether to award minimal attorney's fees or no fees at all.

In arriving at its decision, the Court was persuaded by a 1992 United States Supreme Court decision in which the court analyzed the standard for awarding attorney's fees to a prevailing party under a federal statute. In that case, the United States Supreme Court held that a nominal damages award bears on the propriety of fees awarded under the statute because the degree of the plaintiff's overall success goes to the reasonableness of an attorney's fee award. There, the plaintiffs received one dollar in damages and the Court affirmed the denial of attorney's fees, observing that a plaintiff who seeks compensatory damages, but receives no more than nominal damages, is the type of prevailing party that is entitled to no attorney's fees at all. In sum, there must be a relationship between the extent of the complainant's success and the amount of the fee award.

Martha L. Lester is a Director of Lowenstein Sandler PC and Chair of the firm's Employment Law Practice Group. She can be reached at (973) 597-2388. Julie Levinson Werner, Counsel, is also a member of the Employment Law Practice Group. She can be reached at (973) 597-2550. Kristin L. Troncoso, an Associate, is a member of the Employment Law Practice Group. She can be reached at (973) 422-6420.

Please email the authors at mlester@lowenstein.com, jwerner@lowenstein.com or ktroncoso@lowenstein.com with questions about this article.