In Gerety v. Atlantic City Hilton, a 4-3 majority of the New Jersey Supreme Court recently found in a case of first impression that an employer does not discriminate against pregnant women by treating pregnancy the same as other temporary disabilities under the terms of its disability leave policy. In ruling in favor of the Atlantic City Hilton, the Court reversed the finding of the trial court that the leave policy was inherently discriminatory by not recognizing that only women can become pregnant, and that women with high risk pregnancies must be allowed time off from work for up to nine months. The Supreme Court majority specifically rejected the theory argued by the plaintiff that the New Jersey Law Against Discrimination ("LAD") should be read to require preferential, rather than equal, treatment for pregnant employees.
Plaintiff Christina Gerety was a long-term employee of the Atlantic City Hilton. In September 1997, Gerety became pregnant with twins. Because her doctor ordered her to remain out of work beginning in October 1997 due to medical complications related to the pregnancy, Gerety requested and was given time off from work under the Hilton's leave policies. The first 12 weeks of time off from work was counted as family leave under the Federal Family and Medical Leave Act ("FMLA"). Once that family leave was exhausted, Gerety's request for additional leave was granted under the Company's disability leave policy, which allowed up to six months of leave for every employee regardless of the nature of the disability. That policy also provided, without exception, that employees unable to return to work after six months would be terminated. Because of medical conditions related to her pregnancy, Gerety was unable to return to work in April 1998, when her eligibility for disability leave under the policy was exhausted. Gerety's request for additional time off as personal leave was then rejected by the Hilton because, under the Hilton's policy, personal time may not be used to extend disability leave. Accordingly, Gerety's employment was terminated at that time because she was unable to return to work after exhausting her entitlement to disability leave. Gerety gave birth approximately two weeks later. She thereafter filed suit claiming that her discharge was the result of gender discrimination under the LAD.
The Trial Court Ruling
The Hilton filed a motion for summary judgment based on its contention that Gerety had been discharged pursuant to the terms of its facially neutral disability leave policy, and that she had been treated the same as any other employee, regardless of gender, who was unable to return to work at the end of the six month disability leave period. In denying the Hilton's motion, the trial court recognized that there was no evidence that Gerety had been treated differently than any male employee who was unable to return to work after six months of disability leave, as the record showed that males and females alike had been discharged when they were unable to return to work after exhausting the leave time provided for under the policy. The trial court nevertheless concluded that the leave policy was inherently discriminatory against women by failing to recognize that only women can become pregnant, and that some pregnant women may need to be out of work for more than six months due to medical complications related to the pregnancy. The trial court concluded that the Hilton's disability leave policy had an unlawful disparate impact upon women, and was therefore discriminatory on its face, because it did not provide for additional leave for high risk pregnancies, such as Gerety's, and ruled that it would charge the jury at trial that the policy, as applied to Gerety, was per se unlawful.
The Supreme Court
After the trial court denied a motion for reconsideration, and the Appellate Division denied a motion for leave to appeal, the New Jersey Supreme Court granted the extraordinary relief of leave to appeal in light of the importance of the issue concerning the treatment of pregnancy under disability leave policies to employers throughout the State who have historically tailored their leave policies to meet the long standing legal requirement that pregnancy had to be treated the same as every other disability.
In its 4-3 decision, the majority reversed the holding of the trial court and found that the Hilton's leave policy was not discriminatory. In reaching that conclusion, the majority focused on the fact that the Hilton's leave policy was facially neutral in terms of providing leave to employees regardless of gender, and that the Hilton had applied the policy equally in its treatment of men and women regardless of the underlying medical reason for the need to be away from work. The majority therefore found that the Hilton had not engaged in disparate treatment discrimination in its application of the policy to Gerety, and that the policy did not have a disparate impact upon women, and was therefore not inherently discriminatory, because it was consistent in all respects with the LAD's requirement of equal treatment. In further support of its opinion, the majority observed that the New Jersey Legislature has not required that pregnant employees be given preferential treatment in terms of the amount of time off from work due to pregnancy, or that women be guaranteed up to nine months of leave in case of high risk pregnancies, in enacting laws specifically addressed to the issue, including the New Jersey Family Leave Act ("NJFLA"). The majority further observed that the federal Pregnancy Discrimination Act ("PDA") mandated equal, not preferential, treatment for pregnant women. Ultimately, the majority concluded that the LAD is not violated so long as an employer treats its pregnant employees no differently than other employees who apply for and receive extended leave for medical reasons, and that any requirement for preferential treatment would have to be enacted by the legislature, not the courts.
The Gerety decision was of critical importance in reversing the trial court's finding that neutral leave policies are inherently discriminatory against women, and that such leave policies would be found to be unlawful unless they provide for preferential treatment for pregnant employees. In ruling in favor of the Hilton, the Supreme Court majority restored the state of the law which has existed since 1978, when Congress passed the PDA to assure that pregnancy would be treated "the same as" any other temporary disability which necessitated time off from work for an employee. In response to that act, many states amended their employment discrimination laws to conform specifically to the "same as" mandate from Congress. Others, like New Jersey, adopted the federal standard through case law, as reflected in the lower court decisions in this state over the years finding that the law required equal treatment of pregnancy as a disability. Still others, like California, have enacted laws mandating "preferential treatment" for pregnant employees by requiring employers to guarantee a minimum amount of time-off for pregnancy - up to six weeks, for example - regardless of the amount of leave provided for employees with other disabilities.
In finding that New Jersey law requires only equal treatment of pregnancy as a disability, the Supreme Court majority also properly rejected the effort by the dissent to impose a preferential treatment requirement where no such mandate has been established by the legislature. The dissent recognized that the PDA does not prohibit states, like California, from enacting laws which require preferential treatment of pregnancy in some respects, but then ignored its own finding in concluding that the Court should impose that requirement rather than leaving the issue for the legislature. That position was properly rejected by the majority.
As a result of the majority opinion, New Jersey employers need not amend their leave policies at this time to guarantee leave to pregnant employees for up to nine months, but should be aware that the Gerety opinion has created a fair amount of controversy because of the result - that the pregnant Gerety was discharged only two weeks prior to giving birth, at which time she would have become eligible for additional time off under the New Jersey Family Leave Act to care for her newborn babies. Because of that result, the Supreme Court's decision has spawned calls for legislation to protect the jobs of pregnant employees for the duration of their pregnancy, which must be monitored by employers.
David W. Garland is Co-Chair of the Employment and Labor Department of Sills Cummis Epstein & Gross P.C., which has offices in Newark, New Jersey and New York City. Jerrold J. Wohlgemuth is Of Counsel to the firm. They represented the Atlantic City Hilton before the New Jersey Supreme Court in the Gerety case.