- The ERISA Industry Committee v. Robert Asaro-Angelo, Civil Action No. 20-10094 (ZNQ) (TJB), 2023 U.S. Dist. LEXIS 60746, 2023 WL 2808105 (D.N.J. Apr. 6, 2023).
New Jersey courts are already beginning to see lawsuits surrounding the new amendments. One of the first cases revolving around the NJ WARN Act Amendments is The ERISA Industry Committee v. Robert Asaro-Angelo, Civil Action No. 20-10094 (ZNQ) (TJB), 2023 U.S. Dist. LEXIS 60746, 2023 WL 2808105 (D.N.J. Apr. 6, 2023). In this recent case, the District Court recently considered “whether Senate Bill 3170 (“S.B. 3170”) is preempted by the Employment Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001 et seq. (“ERISA”).” Id. at *3. The Plaintiff, a Washington D.C. nonprofit trade association, sought to enjoin the amendments signed into law by Governor Murphy arguing that “the amendments were illegal because they created individual state requirements for ongoing administrative systems affecting severance benefits that interfered with the administration of federal benefit plans, which EIRSA expressly preempted.”[1]
Ultimately, the District Court denied summary judgment to the Plaintiff because the Plaintiff lacked both organizational and associational standing to challenge the NJ WARN Act amendments.[2] On organizational standing, the Court held that the Plaintiff “failed to identify any evidence as to the actual time spent or costs associated with diverting resources to educate its member companies on S.B. 3170.”[3] Regarding associational standing, the Court found that the Plaintiff “failed to identify any member of its group who would suffer harm from the law.”[4]
Considering the amendments to the NJ WARN Act are relatively new, it is likely that more lawsuits and case law will arise as employers and employees begin to implement and rely on these policies. The Court’s decision in ERISA can serve as the first win for employees protected by the NJ WARN Act.
- DeRosa v. Accredited Home Leaders, Inc., 420 N.J. Super. 438 (App. Div. 2011).
In 2011, only a few years after the original NJ WARN Act was passed, the Superior Court of New Jersey, Appellate Division, ruled in favor of an expansive reading of the Act’s provisions. In DeRosa v. Accredited Home Leaders, Inc., the Court held the NJ WARN Act also encompassed “parent and affiliated companies” and was not limited to only “direct employers.” 420 N.J. Super. at 445. By referring to its federal analogue, i.e., the Worker Adjustment and Retraining Notification Act of 1988 (“federal WARN Act”), the Court found New Jersey’s WARN Act to be consistent with the provisions in the federal WARN Act regarding parent and affiliated companies. Id.
The employees “present on-site were assembled in one location, advised of the shutdown, and informed that they had one hour to pack their belongings and leave the premises.” Id. at 448. Only some of those discharged employees were provided adequate WARN notices. Id. The Plaintiffs were “among the office employees discharged without notice or severance pay.” Id.
Originally, the trial court held the NJ WARN Act’s definition of employer “should be read narrowly, as limited to direct employers, and it did not encompass parent corporations or affiliated businesses.” Id. at 449.Under the NJ WARN Act, the term “employer” is defined as “an individual or private business entity which employs the workforce at an establishment.”[5] The Superior Court highlighted that although the definition of employer, on its face, does not explicitly include parent or affiliated companies, a broader reading of the definition allows for their inclusion as they are “employ[ing] the workforce at an establishment.” DeRosa, 420 N.J. Super. at 452-53. In fact, the Superior Court notes that “because the Act is a remedial statute, … it must be construed broadly.” Id.
- Heinz v. Dubell Lumber Co., 2020 U.S. Dist. LEXIS 221324 (D.N.J. Nov. 23, 2020)
- Ramcharan v. A.F.L. Quality, Inc., 2015 U.S. Dist. LEXIS 91695 (D.N.J. Apr. 14, 2015).
These two NJ District Court cases revolve around class actions that allege a violation of the federal WARN Act and the NJ WARN Act. In both cases, the employers failed to provide their employees with adequate notice as required under the federal WARN Act and the NJ WARN Act. In Heinz, Plaintiff Bernard Heinz alleged “he and at least 157 other employees were terminated without timely notice.” 2020 U.S. Dist. LEXIS 221324, at *1. Similarly, in Ramcharan, Plaintiff Madan N. Ramcharan alleged he and approximately 250 similary-situtaed employees were terminated without notice. 2015 U.S. Dist. LEXIS 91695, at *1-2. In both cases, the NJ District Court “certified WARN classes where the putative class members were employed across different facilities.” Shaw v. Hornblower Cruises & Events, LLC, 2022 U.S. Dist. LEXIS 202703, at *21, 2022 WL 16748584 (D.N.J. Nov. 7, 2022).
Other CASES on Remote Terminations in NJ
Even though remote work has not been explicitly protected under the NJ Warn Act, the trend from other judicial rulings about whether different New Jersey statutes, like the Law Against Discrimination, N.J.S.A., § 10:5-1 et seq., (“LAD”) and the Conscientious Employee Protection Act (“CEPA”), N.J.S.A. 34:19-1 to -14, apply to remote workers seems to be swaying in favor of remote workers. In the post-pandemic world, courts are starting to see more lawsuits surrounding remote work enter the court system.
- Schulman v. Zeotis, Inc., 2023 U.S. Dist. LEXIS 121702 (D.N.J. July 14, 2023).
In a recent decision, the New Jersey District Court reviewed whether the LAD should extend to a remote worker who was employed by a New Jersey company but worked and resided outside of New Jersey.
Frances Schulman (“Schulman”) sued Zoetis, Inc. and Zoetis Reference Labs, LLC (collectively, “Zoetis”) for their alleged violation of the LAD. Schulman, 2023 U.S. Dist. LEXIS 121702,at *2. In her lawsuit, Schulman claimed that she received less pay than certain male co-workers. Id. at *1. Zoetis argued that because Schulman worked remotely from a location outside of New Jersey, and did not reside in New Jersey, the LAD’s protections did not extend to her. On that basis, Zoetis moved to dismiss Schulman’s Complaint. Id. at *1-2.
The New Jersey District Court disagreed, predicting that “the New Jersey Supreme Court will hold that the New Jersey LAD can apply to the case of a non-New Jersey resident who works for a New Jersey-based company, but remotely outside of New Jersey.” 2023 U.S. Dist. LEXIS 121702, *20. Relying on Calabotta v. Philbro Animal Health Corp., the New Jersey District Court observed that in Calabotta, the New Jersey Appellate Division held that the LAD protected nonresident workers and job applicants because the LAD protects “all persons … [and] does not limit the definition of ‘person’ to New Jersey residents or employees.” 460 N.J. Super. at 61.
Additionally, the New Jersey District Court referenced an analogous case in which the New Jersey Appellate Division considered “whether a New Jersey workplace-protection statute, [the Conscientious Employee Protection Act (CEPA), N.J.S.A. 34:19-1 to -14,] can be invoked by a non-New Jersey plaintiff who worked outside of New Jersey, for a New Jersey company.” Id. at *10, citing Halliday v. Bioreference Lab’ys, Inc., 2022 N.J. Super. Unpub. LEXIS 1394, 2022 WL 3051348 (App. Div., Aug. 3, 2022). Like the Calabotta Court, the Halliday Court ruled in favor of the New Jersey statute applying to a non-New Jersey plaintiff who worked outside of New Jersey. Id. at *12. The New Jersey District Court also noted that a number of federal courts have suggested that “the New Jersey LAD can reach the case of a worker based outside of New Jersey who worked for a New Jersey company.” Id.
- Chadwick v. St. James Smokehouse, Inc., 2015 U.S. Dist. LEXIS 38340, 2015 WL 1399121 (D.N.J. March 26, 2015).
In this case, Plaintiff Denise Chadwick was a New Jersey resident who worked from home for Defendants, who were both citizens of Florida. Chadwick, 2015 U.S. Dist. LEXIS 38340, at *1-2. The Defendant’s salmon business was operated in Florida and Scotland. Id. at *1. Plaintiff alleged Defendants wrongfully terminated and retaliated against her when she complained that Defendants were violating FDA regulations. Id. at *3.
Amongst most remote work litigation, the plaintiff has the burden of establishing personal jurisdiction, in particular, the defendant(s) conduct must satisfy the “minimum contacts” or “purposeful availment” requirements. Id. at *8. In Chadwick, the Court ultimately denied Defendant’s motion to dismiss noting that:
“New Jersey has a strong interest in protecting its residents from retaliatory actions.” See Abbamont v. Piscataway Twp. Bd. of Educ., 138 N.J. 405, 418, 650 A.2d 958 (1994) (emphasizing how CEPA “seeks to overcome the victimization of employees and to protect those who are especially vulnerable in the workplace from the improper or unlawful exercise of authority by employers”). This need for protection is all the more true for New Jersey citizens working remotely for out-of-state employers. See Rogers v. Kasahara, 2006 U.S. Dist. LEXIS 74870, 2006 WL 6312904, at *1, 5 (D.N.J. Oct. 16, 2006) (finding specific jurisdiction over Japanese defendants who hired a New Jersey resident to head operations in the United States and Canada when defendants allegedly controlled resident’s employment and terminated him after he complained of defendants’ asserted illegal activities).” Id. at *13-14.
This rhetoric will be incredibly useful for future litigations revolving around remote work. The wave towards expansive definitions and readings of New Jersey statutes is a major victory for employees who were once deemed ineligible for state benefits or protections because of their status as a remote worker. With the growing shift to remote work, courts will eventually need to set forth explicit guidelines for determining if a remote worker is protected by New Jersey legislation. Employers should rely on what factors affect a finding of personal jurisdiction to determine if utilizing the remote workforce will subject them to litigation in a foreign forum.
- Tripp v. Ascentage Pharma Grp. Int’l., 2023 U.S. Dist. LEXIS 147949 (D.N.J. Aug. 23, 2023)
Recently, the NJ District Court ruled against a remote worker who failed to sufficiently allege the NJ District Court had specific personal jurisdiction over his employer. Tripp, 2023 U.S. Dist. LEXIS 147949, at *1. To prevail on a specific personal jurisdiction claim, a plaintiff must show that “(1) the defendant purposefully availed itself of the forum (i.e., New Jersey), (2) the claims arise out of or relate to at least one of the defendant’s in-state-activities, and (3) exercising personal jurisdiction comports with fair play and substantial justice.” Id. at *8-9.
Plaintiff sought relief for six claims: disability discrimination under the New Jersey Law Against Discrimination (“NJLAD”) (Counts 1 and 2); unlawful retaliation under NJLAD (Count 3); unlawful interference under the Family and Medical Leave Act (“FMLA”) (Count 4); failure to restore under FMLA (Count 5); and unlawful retaliation under FMLA (Count 6). Id. at *6.
The Court concluded that “[a]n employee who works remotely from a home office … does not automatically subject his employer to the jurisdiction of his home state.” Id. at *11. Rather, the employer must take “some affirmative action” that targets the forum state. Id. In this case, the Plaintiff’s allegations were based on his own actions that related to his presence in New Jersey, not the Defendant’s directed activities or contact with New Jersey. Id. at *14. The Plaintiff’s actions “were not particular to New Jersey and could have occurred in any state where [the Plaintiff] chose to work.” Id. Overall, the determination if a remote employee is covered by the forum state’s protections hinges on the nature of work a remote employee does for an employer.
However, federal courts in New Jersey have, “in some circumstances, found personal jurisdiction over a defendant on the basis of a single contact having an effect in New Jersey, based on the strong interest in protecting New Jersey residents from injury due to the actions of an out-of-state defendant.” Zipper v. Reno, 111 F. Supp. 2d 484, 492 (D.N.J. 2000).
Since physical presence in the forum is not a requirement when establishing jurisdiction, a defendant is subject to personal jurisdiction in New Jersey when their “utterance injuries someone in [New Jersey]” and “whose fraudulent communication by mail and telephone harms a New Jersey plaintiff.” J.G., at *11. In fact, NJ District Courts have found that specific personal jurisdiction is satisfied when the defendant participates in telephonic and virtual/teams conferences with an individual in the forum state. Christie v. Nat’l Inst. for Newman Studies, 285 F. Supp. 3d 494, 497 (D.N.J. June 28, 2017) (holding tortious conduct committed via online sources, i.e., “virtual contact,” can establish specific personal jurisdiction); See also Grand Entm’t Group, Ltd. v. Star Media Sales, Inc., 988 F.2d 476, 482 (3d Cir. 1993); Carteret Sav. Bank, F.A. v. Shushan, 954 F.2d 141, 147-48 (3d Cir. 1992) (stating that “telephone communications made by a defendant into the forum state may contribute to a finding of minimum contacts”).
Thus, the existing case law suggests that remote workers may satisfy the personal jurisdiction requirements if their pleading facts establish sufficient virtual contacts between the defendant and the forum state.
[1] Kellie Mejdrich, ERISA Group Denied Win In Suit Over NJ Layoff Law, LAW 360 (Apr. 7, 2023), https://www.law360.com/employment-authority/articles/1594790.
[2] Id.
[3] The ERISA Industry Committee, 2023 U.S. Dist. LEXIS 60746, at *7.
[4] Mejdrich, supra note 48.
[5] N.J.S.A. § 34:21-1.