By Francine Foner, Esq. and Ty Hyderally, Esq.

Shanique Wells (“Wells”) was hired by AAA North Jersey (“AAA”) in November 2013 as a Marketing Manager. After resigning from her employment, on September 22, 2016, Wells filed a complaint against AAA, its President, and the Chairman of its Board of Directors, alleging gender/sexual harassment and sexual discrimination in violation of the New Jersey Law Against Discrimination (“LAD”), N.J.S.A. 10:5-1 to -49.[1]  Wells alleged that soon after she was hired, she was subjected to inappropriate, sexually lewd behavior by David Hughes (“Hughes”), who was, at that time, one of the company’s Vice Presidents. Wells alleged that over a period of two and half years, Hughes, who was promoted to President during that time period, had engaged in behavior including making a variety of crass and vulgar remarks, displaying/showing obscene pictures and making obscene gestures, and subjected Wells to sexual touching. Wells further claimed that when she complained to the company’s Human Resources representative about the sexual harassment, she was told Human Resources could not do anything about the President’s behavior because Human Resources reported to him. Wells further alleged that defendants retaliated against her by reassigning her to work with someone she had complained about.

The trial court dismissed Wells’ claims on summary judgment, because Wells had not suffered an adverse employment action and because it concluded that the conduct described by Wells constituted only “‘offensive utterances’ that reflect a lack of workplace decorum.”  However, on July 8, 2020, the Appellate Division reversed the trial court’s dismissal of Wells’ hostile work environment sexual harassment claim, because the trial court plainly ignored established legal principles.  Shanique Wells v. AAA N. Jersey, 2020 N.J. Super. Unpub. LEXIS 1340. The Appellate Division first reviewed the well-settled case law in New Jersey that an employee does not need to suffer an adverse employment action, such as termination, to bring a claim for hostile work environment sexual harassment under the LAD.  As the Wells Court opined, “[t]he ‘[l]oss of a tangible job benefit is not necessary for a hostile work environment claim, because the harassment itself affects the terms of conditions of employment.” Id. at *16, citing Shepherd v. Hunterdon Developmental Ctr., 174 N.J. 1, 28 (2002). The Appellate Division found that the trial court had simply ignored this governing legal principal, and erroneously concluded, without any legal basis, that Wells could not proceed with her claim of sexual harassment because she had not suffered an adverse employment action.

The Appellate Division next discussed why the trial court also erred by determining that the behavior alleged by Wells was not sufficiently severe or pervasive to allow Wells’ claim of sexual harassment to go to the jury.  The Appellate Division found that this determination is to be made based upon allegations which, if true, reflect that “working conditions were affected by the harassment to the point at which a reasonable woman would consider the working environment hostile.” Wells at *16-17. In addition, in reaching this decision, a court should consider “the cumulative effect of the various incidents, bearing in mind ‘that each successive episode has its predecessors, that the impact of the separate incidents may accumulate, and that the work environment created may exceed the sum of the individual episodes.’” Id. at 607 (quoting Burns v. McGregor Elec. Indus., Inc., 955 F.2d 559, 564 (8th Cir. 1992)).  Based upon these guiding principles, the Appellate Division found that the crass “jocular” behavior described by Wells was consistent with New Jersey Supreme Court precedent describing conduct which rises to actionable sexual harassment under the LAD. Wells at *17-18, citing Lehmann v. Toys ‘R’ Us, Inc., 132 N.J. 587, 595-97 (1993), and Griffin v. City of E. Orange, 225 N.J. 400, 406 (2016). 

The Appellate Division also addressed the employer’s contention that it had in place policies and procedure for employees to complaint about sexual harassment, and that Wells had not followed those policies, providing it with a defense to her sexual harassment allegations, relying upon Aguas v. State, 220 N.J. 494 (2015). However, Wells alleged that the complaint policy was ineffective, as she had, among other things, complained to the company’s Human Resources representative about her supervisor’s sexual harassment, but was told Human Resources could not do anything about the President’s behavior because Human Resources reported to him. Wells further alleged that she was then retaliated against by being reassigned to work with someone she had previously complained about. The Appellate Division opined that “[s]imply asserting they did not know the President of their company was sexually harassing a subordinate is no defense,” and in any event, these were factual disputes which a jury should decide. Wells at *30-31.

Lastly, the Appellate Division addressed the trial court’s refusal to review certain internal investigation documents, which Wells contended were prepared before she notified defendants of her lawsuit, and could be used to show that the employer’s policies and procedures were inadequate. Defendants disputed Wells’ contention, and claimed that the documents were prepared after notice of Wells’ lawsuit and were subject to attorney-client privilege as being prepared in anticipation of litigation.  The Appellate Division surmised that the only reason the trial court had not reviewed the documents to determine whether or not they were privileged, was because of the Judge’s erroneous dismissal of Wells’ sexual harassment claims. Therefore, the Appellate Division vacated the trial judge’s decision denying an in camera review of those documents and directed that the trial judge review the documents, in camera, in accordance with well-established legal principles. Id. at *34-35, citing Pomerantz Paper Corp. v. New Cmty. Corp., 207 N.J. 344 (2011); Payton v. N.J. Tpk. Auth., 148 N.J. 524 (1997); Medford v. Duggan, 323 N.J. Super. 127 (App. Div. 1999).

This decision strongly reinforces that sexual harassment claims under the LAD do not require that an employer take any adverse employment action against an employee, other than the sexual harassment itself.  In addition, even where each abusive incident may not appear severe or pervasive when viewed individually, the cumulative effect of separate sexually harassing incidents over an extended time period can also create a sufficiently severe or pervasive hostile work environment. Further, where there are factual disputes surrounding the effectiveness a company’s complaint policy and procedures, a jury should decide that issue. Finally, this decision also supports a court’s obligation to confidentially review a company’s internal investigation documents to determine whether or not they are subject to attorney-client privilege.

In all, a significant victory for victims of sexual harassment in the workplace!

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[1] Wells also filed a claim for violation of the Conscientious Employee Protection Act, N.J.S.A. 34:19-1 to – 14, but did not appeal the dismissal of that claim.