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New Jersey Supreme Court expands damages for whistle-blowers

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in Discrimination and Harassment,Employment Law,Human Resources

The New Jersey Supreme Court has just made it easier for whistle-blowers to recover back-pay damages.

In Donelson v. DuPont Chambers Works (A-112-09, N.J. Supreme Court, 2011) the state’s highest court expanded the definition of “adverse employment action” and held that an employee can recover lost wages if the employer’s retaliation caused a disability that made the employee unable to continue working.

The case reinforces a critical point: Employers must make sure their policies and practices don’t violate the rights of whistle-blowers who raise workplace concerns.

Initial safety complaint

John Seddon worked for about 30 years as an operator technician at a DuPont chemical plant in Salem County. Seddon worked with dangerous chemicals and had to ensure that the equipment at the facility worked properly and the chemicals were handled safely.

In 2002, Seddon filed a complaint with the federal OSHA because he believed that DuPont’s security personnel—whose duties included randomly searching employees’ vehicles—compromised employee safety by conducting the searches at night as traffic “whizzed by.”

After he complained, DuPont made Seddon report directly to a shift super­visor who imposed sick day and vacation day reporting requirements that did not apply to other employees.

Ten months later, Seddon made an internal complaint stating his belief that one of the plant’s reactors was un­­safe and could lead to a serious chemical accident. He claimed the company responded by re­­moving the safety violations manual from the workplace, a document he had referenced when making his previous complaints.

Then Seddon claimed that DuPont made false accusations against him—that he had falsified timecards and made a fictitious entry in a log. When Seddon received an unfavorable performance evaluation, he claimed he was subjected to verbal harassment. He made another complaint to the corporate office.

Piling on the punishment?

The company placed Seddon on paid short-term disability but he allegedly lost considerable overtime during that period. DuPont required him to submit to an examination by three mental health professionals before he could return to work.

One of the professionals concluded that Seddon had dysphoria—a feeling of “general dissatisfaction, restlessness, depression, and anxiety”—and was vulnerable to depression. After Seddon returned to work, he was placed on probation, subjected to 12-hour work shifts, which he said required him to work in isolation. About that time, he began treatment with a psychiatrist and therapist.

Seddon then took a six-month leave of absence and subsequently retired on a disability pension ­without ever returning to work at DuPont.

Whistle-blower retaliation suit

Seddon filed a lawsuit alleging that he was retaliated against in violation of the Conscientious Employee Pro­­tection Act (CEPA). A Salem County jury found in Seddon’s favor and awarded him $724,000 for economic losses, $500,000 in punitive damages and $523,289 in attorneys’ fees.

In an interesting twist, the jury did not award Seddon any damages for emotional distress or pain and suffering, even though the facts seem to show that he would have been able to present at least a credible basis for such damages.

The New Jersey Supreme Court affirmed the verdict. The court held that even though Seddon was not terminated, he still had a viable claim under CEPA for lost wages because the statute contained a broad definition of “adverse employment action.”

The court also held that Seddon did not have to show the elements of a “constructive discharge” to obtain lost wages in CEPA cases. That is normally a difficult burden for a plaintiff to overcome, since it requires the em­­ployee to show that the company’s conduct was “so intolerable that a reasonable person would be forced to re­­sign rather than continue to endure it.”

Tips for employers

Your employee handbook no doubt already contains policies prohibiting retaliation against employees who complain about discrimination or harassment. This case makes it clear that you also need to develop and adopt policies that specifically prohibit retaliation against employees for “blowing the whistle” or making complaints of misconduct in the workplace.

Always take such complaints seriously. Investigate them promptly and professionally.

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