Defense Digest

Clarified Prima Facie Standard for Proving Compensatory Damages in New Jersey Employment Discrimination Cases

By Sharri H. Horowitz, Esq.*

Recently, the Appellate Division of the Superior Court of New Jersey clarified the requirement for proving a prima facie case of emotional distress in the context of discrimination.

Carol Tarr worked as a finance and insurance manager in a car dealership. Only two women worked in the company: the plaintiff and her supervisor. The male co-workers continually made degrading, demeaning, and demoralizing sexual insults and sexual innuendoes. Summarizing the plaintiff's testimony and evidence, the court, sufficiently outraged, wrote, "We are satisfied that our characterization of the sexually explicit remarks as despicable, insulting, reprehensible, crude, gross, demeaning, and contemptible hardly begins to convey the flavor of their affront." Tarr v. Mack Auto Mall, 360 N.J. Super. 265, *7 (App. Div. 2003).

The plaintiff did not present expert testimony in support of her emotional distress evidence. Rather, she testified to "intense humiliation and embarrassment," which included "turn[ing] beat red," "want[ing] to crawl under my desk," and "cr[ying] all the way home . . . . " Tarr, 360 N.J. Super. at *8. At trial, the judge granted the defendant's motion to dismiss the compensatory damage claim. According to the Appellate Division, the trial judge wrongly believed that both discrimination and tort cases required similar elements to prove emotional distress, that the plaintiff needed to demonstrate manifestations of physical illness, and that the plaintiff could not recover for short-term emotional distress.

The Appellate Division reversed. It clarified the existence of a separate standard for employment cases, allowing compensation if the plaintiff suffers from "acute embarrassment and humiliation" by distinguishing the standard applied in tort cases and in insurance coverage cases. See Tarr, 360 N.J. Super. at *7. For tort cases, the distress must be "so severe that no reasonable man could be expected to endure it." Buckley v. Trenton Saving Fund Society, 111 N.J. 355, 368 (1988). In making this determination, the court considers the frequency of the distress, the length and intensity of the condition, and interference with an everyday routine. See Buckley, 111 N.J. at 369; Lascurain v. City of Newark, 349 N.J. Super 251, 279-80 (App. Div. 2002). Even absent physical manifestations, a plaintiff may still recover in the tort context, as long as the illness satisfies the severity and substantiality threshold. For insurance cases, coverage should be provided under an insurance policy's bodily injury definition when "emotional injuries [are] accompanied by physical manifestations." Voorhees v. Preferred Mutual Insurance, 128 N.J. 165, 178 (1992).

The Appellate Division surveyed prior New Jersey cases defining humiliation. The court considered a 1970 Chancery Division case which first acknowledged that a discrimination plaintiff may receive compensable damages from his suffered humiliation. See Gray v. Serruto Builders, 110 N.J. Super. 297, 315 (Ch. Div. 1970). The Gray Court found that a plaintiff may recover damages even if she suffered only from indignity and humiliation, as opposed to illness. See Gray, 110 N.J. Super. at 315-17. The Supreme Court then affirmed the "humiliation-damages concept" in Zahorian v. Russell Fitt Real Estate Agency, 62 N.J. 399, 404, 416 (1973), and found the Division on Civil Rights may award damages. In that case, the plaintiff had also testified to physical ailments in addition to the humiliation.

The court then focused on what was crucial to its analysis. It examined the Legislature's intent in enacting New Jersey's anti-discrimination law, the New Jersey Law Against Discrimination ("LAD"). The LAD includes "physical and emotional stress" as one of the enumerated harms that "give rise to . . . compensatory and punitive damages." N.J.S.A. 10:5-3. At common law, courts held that compensatory damages were recoverable for humiliation suffering. The Legislature enacted a 1990 amendment to the LAD to preserve this common law right. The Tarr Court stated that the Gray and Zahorian Courts' finding of humiliation, embarrassment and indignity was to be included in the LAD's definition of stress.

As additional support for its reasoning, the court considered other federal appellate and district court cases which held that the "transitory emotional distress caused by the humiliation and indignity of discriminatory conduct is compensable." Tarr, 360 N.J. Super. at *17. In U.S. v. Balistrieri, 981 F.2d 916, 931 (7th Cir. 1992), for example, the jury awarded each plaintiff $2,000 in compensatory damages after they testified to "being upset, humiliated, embarrassed or shamed." The plaintiffs, acting as black housing testers, had been denied the opportunity to rent apartments compared to the white housing testers. The court held that an inverse relationship existed - that the more degrading the defendant's conduct, the less direct evidence needed to support an emotional distress award. See also Kriss v. Sprint Communications Co., Ltd. Partnership, 851 F. Supp. 1350, 1361 (D. Minn. 1994) (gender discrimination plaintiff awarded compensatory damages for embarrassment and frustration because she was not promoted); Johnson v. Goodyear Tire & Rubber Co., 790 F. Supp. 1516, 1529 (E.D. Wash. 1992) (gender discrimination plaintiff awarded damages for depression and becoming more easily upset). Thus, by relying on Gray, Zahorian, the LAD, and other cases, the Appellate Division concluded that humiliation is compensable in discrimination cases in New Jersey.

Applying the elucidated standard to the Tarr facts, the court found that the plaintiff testified to egregious daily sexual harassment. The nature of the sexual harassment was so demeaning and degrading that any reasonable woman would have suffered from "humiliation, embarrassment and loss of personal dignity." Tarr, 360 N.J. Super. at *20. The plaintiff thus satisfied the standard of emotional distress.

Even without expert testimony, permanency, or an intense degree of symptoms, the plaintiff may recover money damages. In this case, the court remanded for the jury to determine the amount of damages and to consider several factors. First, the award increases with a longer exposure to the harassment. The second factor, the degree of the public or rude humiliation also may increase the award. Third, the actual content of the discriminatory conduct matters, with increased damages for losing a job compared to hearing an insult.

The court's clarification of the emotional distress standard in discrimination cases allows a plaintiff to more easily get to a jury regarding compensatory damages. This case reminds us that an expert is not needed. If the plaintiff does not have an expert, of course, counsel may always seek to preclude her testimony. But, as a result of Tarr, we may see fewer motions granted and more testimony allowed in these cases.

* Sharri is an associate in our Cherry Hill, NJ office. She can be contacted at (856) 414-6016 or shorowitz@mdwcg.com.