Alan Schorr’s Employment Case of The Week ending June 20, 2014

Rodriguez v. Raymours, Inc., __ N.J. Super. __, 2014 N.J. LEXIS 88 (published) (N.J.App.Div. June 19, 2014)

The Appellate Division this week held that if an employer does not wish to be bound by a statute of limitation, it can force an employee, as a condition of employment, to waive that statutory right. In Rodriguez v. Raymours Furniture Co., the Appellate Division affirmed the dismissal of a Law Against Disrimination case filed nine months after termination because that employee, in his job application, had signed a statement agreeing to waive statutory statutes of limitations and agree that any suit must be filed within six months.

Sergio Rodriguez worked as a driver for Raymour & Flanigan for three years. He suffered a work-related knee injury which caused him to miss about ten weeks of work. Three days after returning to full-duty he was terminated as part of a company-wide reduction in force. Raymours claimed that Mr. Rodriguez’s job performance was sub-standard. Mr. Rodriguez disputed that contention and filed a lawsuit alleging workers compensation retaliation and violation of the New Jersey Law Against Discrimination.

At the close of discovery, Raymours filed for summary judgment on the basis of a claimed waiver of the statute of limitations signed by Mr. Rodriguez prior to being hired by Raymours. The Trial Court dismissed, holding that Raymours agreement was reasonable and not in violation of public policy, and therefore the case must be dismissed because it was not filed within six month of termination. Mr. Rodriguez appealed.

The Appellate Division first reviewed whether the take-it-or-leave-it agreement was a contract of adhesion. On that point the Appellate Division sided with the Plaintiff finding that there was sufficient evidence that Mr. Rodriguez had no bargaining power to find that the agreement was adhesive. However, the Court rejected the Plaintiff’s argument that the lack of bargaining power rendered the agreement unconscionable per se and therefore unenforceable.

The Court then analyzed whether the reduction of the statute of limitations can be shortened by agreement, despite statutes of limitations set by the Legislature. The Court cited case law and precedent for Court accepting private agreements to shorten statutory limitations periods. Finding that such agreements are acceptable, the Court then found that six months was reasonable. The Court stated, for example, that an employee has the option of going to the Division on Civil Rights to pursue a discrimination claim, and the DCR carries a 180 day statute of limitations. Here, the Court’s logic fails, in my opinion, because employees are not forced to go to the Division on Civil Rights and have the option of waiting longer to bring their matter in Court. Sometimes it simply takes longer than six months to investigate and understand the facts, law, and damages caused by a discriminatory termination.

This decision is also very troubling in that it assumes that Mr. Rodriguez remembered that in his employment application, buried in the legalese, there was an agreement to restrict his statute of limitation. Employers generally do not provide copies of employment applications to their employees, and then years later in the event of a wrongful termination, there is literally no way for the employee or the employee’s attorney to know about any “agreement” buried in the language of an employment application.

Ultimately, this published opinion condones, on public policy grounds, employers forcing employees, as a condition of work, to waive all sorts of statutory rights. Although this opinion only specifically dealt with the waiver of a statute of limitations, this may open the door for employers who do not wish to be governed by anti-discrimination laws to force employees to agree that the employer does not have to comply with such laws. This is slippery and very dangerous slope.

The Plaintiff’s attorney has announced that he will be Petitioning the Supreme Court to hear this matter. The National Employment Lawyers Association- New Jersey has also indicated that it will provide an amicus brief in support of reversal.

Plaintiff’s Counsel: Alan L. Krumholz, Krumholz Dillon, P.A.

Defendant’s counsel: Edward T. Groh.

Appellate Judges: Messano, Rothstadt and Lisa.

Trial Court Judge: Donald S. Coburn, J.S.C.