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New Jersey Courts OK Jury Trial Waiver in Employment Application

  • October 15, 2002

A ruling by the New Jersey Supreme Court has underscored the necessity for employers to conduct sexual harassment prevention training for employees. The court said New Jersey employers must train managers and supervisors and must make the training available to other employees if they want to avoid liability. In another decision, the court finds a jury trial waiver in an employment application binding upon the employee. A third ruling by the New Jersey Superior Court gives a green light to a wrongful discharge suit based on a violation of public policy if an employer fails to conduct a fair and thorough investigation.

I. The New Jersey Supreme Court upholds an arbitration agreement and jury trial waiver contained in an employment application.

The New Jersey Supreme Court, in the case of Martindale v. Sandvik, Inc., 173 N.J. 76, upheld the enforceability of an employee's agreement to waive her right to a jury trial and submit any disputes she may have with her employer to arbitration. The waiver in question was contained in the application for employment with Sandvik, signed before beginning employment.

In light of the Court's decision, New Jersey employers should consider seriously the inclusion of a jury trial waiver in their employment applications. In addition, employers should weigh the pros and cons of compulsory arbitration in order to determine whether to include a compulsory arbitration provision in an employment application.

II. The New Jersey Supreme Court holds that in order to avoid liability for sexual harassment by a supervisor, an employer must take certain steps, including mandatory training for supervisors and training which is "available" to all other employees.

The New Jersey Supreme Court, in the case of Gaines v. Bellino, 173 N.J. 301, held that in certain circumstances, an employer could avoid being liable for sexual harassment by a supervisor if the employer had the following measures in place:

  1. formal policies prohibiting harassment in the workplace;
  2. complaint structures for employees' use, both formal and informal in nature;
  3. anti-harassment training, which must be mandatory for supervisors and managers, and must be available to all employees of the organization;
  4. the existence of effective sensing or monitoring mechanisms to check the trustworthiness of the policies and complaint structures; and
  5. an unequivocal commitment from the highest levels of the employer that harassment would not be tolerated, and demonstration of that policy commitment by consistent practice.

If these measures are not in effect, an employer may be liable for sexual harassment even if an employee fails to complain about the supervisor's conduct.

III. A Superior Court Judge rules that the public policy of New Jersey prohibits the termination of an employee accused of sexual harassment absent a fair and thorough investigation.

A Middlesex County Superior Court Judge ruled in Grasser v. UnitedHealthCare, Docket No. MID-L-012026-99, that an employee wrongly accused of sexual harassment could pursue a claim of wrongful discharge against his employer. In denying the employer's motion to dismiss the claim for wrongful discharge in violation of New Jersey's public policy, the court found that "the public policy of New Jersey mandates that employers conduct fair and thorough investigations when they know of potential sexual harassment in the workplace." Therefore, the court concluded "an employer violates the clear public policy by firing an employee for alleged sexual harassment based on [the] employee's consensual romantic relationship with a co-worker." Thus, the court permitted the employee to pursue his wrongful discharge claim to trial.

The Grasser decision highlights for employers the importance of conducting "fair and thorough" investigations into workplace harassment and making balanced decisions based on those investigations. Additionally, the decision emphasized the importance of having policies in place which clearly prohibit inappropriate conduct, such as co-worker dating, especially between supervisors and subordinates.

©2002 Jackson Lewis P.C. This material is provided for informational purposes only. It is not intended to constitute legal advice nor does it create a client-lawyer relationship between Jackson Lewis and any recipient. Recipients should consult with counsel before taking any actions based on the information contained within this material. This material may be considered attorney advertising in some jurisdictions. Prior results do not guarantee a similar outcome.

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