On June 8, 2021, the New Jersey Supreme Court made two significant rulings in Richter v. Oakland Board of Education. First, the Court held that an employee need not establish an adverse employment action as an element for a failure-to-accommodate claim under the New Jersey Law Against Discrimination (NJLAD). This holding built on prior case law, particularly in the context of retaliation claims, and was not unexpected given the broad remedial purpose of the NJLAD.  The second holding, however, is much more significant and may have far-reaching implications. Specifically, the Court held that the exclusive remedy provision of the New Jersey Worker’s Compensation Act’s (WCA), also known as the “workers’ compensation bar,” does not prevent an employee from recovering for physical injuries through a claim under the NJLAD, and there is no need for the employee to show an intentional wrong (which is generally required to recover for physical workplace injuries outside of the workers’ compensation context). This is a major shift in the law governing workplace injuries and potentially opens a host of new available damages in certain circumstances.

The facts of this case are as follows: Plaintiff Richter was a diabetic middle school teacher. The school scheduled her for a lunch break late in the day.  She requested an earlier lunch break due to concerns over her blood sugar levels, but the school did not adjust her schedule as requested. One day at school, Richter experienced a hypoglycemic event in front of her students that resulted in her having a seizure, hitting her head on table, and ultimately suffering permanent injuries. Richter had her medical bills and partial permanent disability covered by the WCA, receiving approximately $105,000 in benefits. Later, however, Richter sued the Oakland Board of Education for failure to accommodate her diabetic condition under the NJLAD and sought to recover, among other things, damages for her physical injuries. The School Board argued that the claim was barred by the exclusivity provision of the WCA. The Court, recognizing that this was the first time it was considering the interplay between the WCA and another statutory scheme (as opposed to common law claims), determined that, in light of the public policy goals of the NJLAD and WCA, neither statute displaced the other: they found the statutes work in tandem to provide relief to employees for different types of workplace wrongs. The Court determined that a double recovery for the same physical injury could be prevented through a lien against the NJLAD recovery in the amount already provided directly to Plaintiff under the WCA.

This decision will have far reaching implications for employers. Prior to this decision, it was widely accepted that physical injuries in the workplace were compensable only under the WCA. Workers’ compensation damages are generally more limited than those received through tort claims, which was part of the original trade-off for workers’ compensation benefits in lieu of common law claims. This decision opens up a new category of possible damages under the NJLAD for physical injuries that occur in the workplace allegedly as a result of discriminatory conduct. Employers can no longer be assured that the WCA will limit recovery for workplace injuries. This decision could also complicate potential settlement agreements under the NJLAD, as workers’ compensation carriers’ interests may need to be considered.

We will continue to monitor the development of case law following this decision.  If you have any questions about specific issues facing your workforce, our experienced labor and employment attorneys are available to assist.

Walter Atencio, a Reed Smith Summer Associate, contributed to this post.