NJ Supreme Court Says Employees Can’t Agree to Shorten Statute of Limitations

Several months ago, I blogged about the Rodriguez v. Raymours Furniture Co., 436 N.J. Super. 305 (Super. Ct. 2014)case. The case addressed an important issue – whether or not an employee’s could enter an agreement to shorten the statute of limitations period from 2 years to six months to assert an employment discrimination claim pursuant to New Jersey’s Law Against Discrimination (LAD). Yesterday, the New Jersey Supreme Court held that the statute of limitations period could not be reduced by agreement.

In reaching this important decision, the New Jersey Supreme Court first discussed the importance of eradicating discrimination in New Jersey. That analysis led the court to conclude that it was against public policy for employees to reduce their right to sue an employer by signing an agreement. Moreover, the court held that if there was a shortened statute of limitations, lawyers presented with potential discrimination cases would not have an opportunity to properly investigate those claims before filing. Lawyers in those cases would need to file immediately to ensure they did not violate the applicable statute of limitations. The Court reasoned that by shortening the statute of limitations, frivolous (not well reattached) claims may be asserted.

Moreover, the Court reasoned that employers have a basis to avoid certain forms of liability if they “investigate” and “address” work-place discrimination. The Court reasoned that if employees had a shortened period to file litigation, the employer would not be afforded the defenses available to them if they properly investigated and addressed the allegations.

Finally, the Court reasoned that shortening the statute of limitations period could negatively affect the use of mediation to settle employment discrimination claims. Mediation is often a useful tool in settling cases prior to their commencement. If the limitations period was shortened, parties may not be able to engage in pre-litigation settlement discussions. Because LAD claims are “fee shifting,” this may make it more difficult to settle cases once they are filed

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