Employees In New Jersey May Recover For Wage Discrimination Resulting From Employer’s Biased Decisions Which Preceded Statutory Limitations Period

The New Jersey Law Against Discrimination, N.J.S.A. §§ 10:5-1 – 10:5-30 (the “NJLAD”), bars all public and private employers from paying unequal wages on the discriminatory basis of, among other protected characteristics, age or gender.  The statute of limitation for civil lawsuits brought under the NJLAD is two years.  Montells v. Haynes, 133 N.J. 282, 285-286 (N.J. 1993).  For further discussion of the NJLAD, see here.

In Alexander v. Seton Hall University (N.J. Nov. 23, 2010), the New Jersey Supreme Court, by a 5-to-1 vote, held that a worker suing under the NJLAD for the payment of wages on a discriminatory basis may recover back pay for up to two years preceding the filing of the lawsuit, even where those disparate wages resulted from discriminatory pay decisions which the employer made more than two years ago, “as long as the wage remains tainted by the original discriminatory action.”

By contrast, the Alexander Court held, an employee suing under the NJLAD for unequal wages is time-barred from recovering back pay for any pay periods more than two years before the commencing of the lawsuit, “regardless of the length of time [the] plaintiff has been subjected to discriminatory pay.”

The New Jersey Supreme Court’s Alexander decision provides that under the NJLAD, as under (recently amended) federal law, “Each payment of . . . discriminatory wages . . . constitutes a renewed separable and actionable wrong.”

Specifically, in 2009, the U.S. Congress enacted the Lilly Ledbetter Fair Pay Act (the “FPA”), which amends Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq. (“Title VII”).  The FPA makes clear that an unlawful act occurs “each time wages, benefits, or other compensation is paid” resulting from an earlier discriminatory compensation decision or other practice.  42 U.S.C. § 2000e-5(e)(3)(A).  Further, the FPA permits:

recovery of back pay for up to two years preceding the filing of the charge, where the unlawful employment practices that have occurred during the charge filing period are similar or related to the unlawful employment practices with regard to discrimination in compensation that occurred outside the time for filing a charge.

42 U.S.C. § 2000e-5(e)(3)(B).  For further discussion of Title VII, see here.

In Alexander, the plaintiffs were three female tenured professors at Seton Hall University, each more than 60 years of age, whom the University had hired in 1976, 1981, and 1987, respectively.  The plaintiff professors had sued Seton Hall under the NJLAD in 2007, alleging that they were paid unequal wages in comparison to younger and/or male employees.  This pay inequity had taken place, the plaintiffs maintained, since not later than 2004-2005, when the University compiled a written, internal report documenting “that higher salaries were paid to newer, younger faculty members as compared to those paid to longer-term, older faculty members,” and that Seton Hall further engaged in a pattern of disparate compensation based on gender.

The motions court had dismissed the Alexander plaintiffs’ complaint as time-barred, holding that any disparate wages paid to the plaintiffs, including those paid within the two years immediately preceding the complaint’s filing, were simply the result of allegedly discriminatory salary decisions that occurred outside of the NJLAD’s two-year statute of limitations.  New Jersey‘s Appellate Division had affirmed the trial court’s final order dismissing the plaintiffs’ case.

In Alexander, the New Jersey Supreme Court reversed and remanded for reinstatement of the plaintiff professors’ timely claims of wage discrimination.  That is, the Alexander Court held “that plaintiffs’ complaint was timely in respect of the allegedly discriminatory wages paid during the two years immediately prior to the filing of their complaint.”

If your company needs assistance or guidance on a labor or employment law issue and your company is located in the New Jersey area, call Attorney David S. Rich at (347) 941-0760.