Patience is a Virtue: NJ Appellate Division Affirms Settlement of Discipline Bars Recovery Under the NJLAD

On May 1, 2023, in Onukogu v. New Jersey State Judiciary, the Superior Court of New Jersey, Appellate Division affirmed the trial court’s grant of summary judgement in favor of the employer, affirming the dismissal of the employee’s allegations of discrimination and retaliation under the New Jersey Law Against Discrimination (NJLAD). The case demonstrates how employers, when faced with employees with long-term disciplinary problems who they wish to retain, can link decisions not to discipline or terminate to a release of potential claims.

FACTS

In 2000, Chidi Onukogu commenced his employment with the New Jersey State Judiciary, Essex Vicinage (the Judiciary). Onukogu had well documented performance issues throughout his career at the Judiciary.

In January 2014, Onukogu received his first Preliminary Notice of Major Disciplinary Action (PNDA). The PNDA alleged Onukogu violated the Judiciary’s polices and directives by failing to report to his direct supervisor that he had received a notice to appear in court in connection with his then pending divorce case. Onukogu agreed to a one-day suspension that may be used against him in future progressive discipline. A condition of the settlement was that Onukogu release the Judiciary from all claims arising from the allegations contained in the PNDA.

In 2015, after Onukogu failed to return to work from vacation in Nigeria, he alleged that he was hit by a bus, lost consciousness and was hospitalized for 7 weeks, thus unable to contact his supervisor. As a result of Onukogu’s failure to return to work, the Judiciary issued Onukogu a PNDA for job abandonment. When he finally returned to work, Onukogu did not request any additional accommodations and settled his PNDA. Onukogu agreed to accept a 60-day unpaid suspension that included a last chance provision. The settlement also provided that Onukogu agreed to release all claims, potential or existing, arising out of the matter, including any claims arising under the NJLAD, all tort and contract claims, and all claims under any other statutes, laws, or the common law.

In 2016, the Judiciary learned that Onukogu submitted FACTS printouts, non-public information maintained by the Judiciary, in his personal divorce matter. Although Onukogu did not have access to the FACTS system though his employment with the Judiciary, Onukogu admits that he did submit the FACTS printouts in the divorce matter and that the printouts were not otherwise available to the public.

The Judiciary launched an investigation into Onukogu’s submission of the FACTS printouts and informed Onukogu that if the Judiciary determined that he had violated the Code of Conduct, disciplinary action would be taken. In connection with the investigation, Onukogu admitted that another employee of the Judiciary provided him with the FACTS printouts. However, when the Judiciary asked Onukogu who gave him the printouts, Onukogu refused to provide the employee’s name. Onukogu claimed that his shop steward advised him that he did not need to provide the Judiciary with any information that could be used against him.

On August 31, 2016, the Judiciary served Onukogu with a PNDA for the termination of his employment based on his use of the FACT printouts in his personal divorce matter and his failure to disclose the same of the employee who provided him the printouts. The Judiciary held a hearing on the charges, at which Onukogu was represented by counsel. The hearing officer upheld the Judiciary’s decision to terminate Onukogu. Thereafter, the Judiciary served Onukogu with a Final Notice for Disciplinary Action (FNDA), terminating his employment effective January 27, 2017. The termination was appealed and ultimately upheld.

TRIAL COURT DECISION

Onukogu filed a lawsuit against the Judiciary alleging that the decision to terminate his employment was discriminatory and retaliatory in violation of the NJLAD. Onukogu also alleged interference with prospective economic advantage, intentional infliction of emotional distress, and breach of contract. Onukogu claimed that his termination was in retaliation for his alleged temporary disability, request for leave and/or his resulting leave of absence in 2015. Further, Onukogu claimed that the Judiciary retaliated against him in issuing the November 2015 PNDA and placing him on a 60-day suspension without pay. The trial court entered summary judgement, dismissing Onukogu’s interference with prospective economic advantage, intentional infliction of emotional distress, and breach of contract claims. Initially, the trial court granted summary judgement only to Onukogu’s NJLAD claims based on conduct that occurred prior to the December 2015 settlement agreement and release, but after reconsideration, granted summary judgement in dismissing all of Onukogu’s claims. Onukogu appealed the decision dismissing his NJLAD claims.

APPELATE DIVISION DECISION

The Appellate Division found Onukogu’s claims to be barred by the settlement agreement and release and found that Onukogu’s agreement to the release of his claims against the Judiciary was a condition of the resolution of the charges in the November 2015 PNDA. Further, the Appellate Division noted that at the time that he entered into the December 2015 settlement agreement and release, Onukogu was aware of all potential claims related to his alleged temporary disability and resulting request for leave.

In upholding the release of Onukogu’s claims, the Appellate Division noted the strong public policy of favoring settlement agreements, stating that courts generally should honor and enforce them. Furthermore, the Appellate Division rejected Onukogu’s position that he executed the settlement under duress. The Appellate Division found that Onukogu arguments were nothing more than legal conclusions and that Onukogu had failed to allege any facts to suggest that he was under duress at the time of the execution of the December 2015 settlement and release. The Appellate Division found that any insistence by the Judiciary as to the terms of the agreement or that Onukogu execute the agreement, otherwise it would proceed with the hearing on the pending PNDA, was not evidence of wrongful conduct such that Onukogu was under any duress. Contrary to Onukogu’s assertion of duress, the Appellate Division noted that Onukogu was represented by his collective negotiations unit representative and was given the opportunity to seek counsel. Moreover, the Appellate Division noted that Onukogu reaped the benefit of the settlement, dismissing the PNDA charges and returning to work. Accordingly, the Appellate Division enforced the December 2015 settlement and release and dismissed Onukogu’s NJLAD claims that predated the agreement.

As to Onukogu’s remaining claims, Onukogu claims that the Judiciary retaliated against him on the basis of his temporary disability, request for leave, and/or leave of absences, in the form of a hostile work environment. The Appellate Division disagreed. Specifically, the Appellate Division found that Onukogu failed to establish that any of the complained of conduct, which he set forth as his basis for a hostile work environment, was in response to or otherwise caused by Onukogu’s 2015 alleged temporary disability, request for leave, and/or leave of absence.

BOTTOM LINE

If an employer decides to retain a problem employee (here the fact that this was a union-represented public sector employee likely played a strong role), a potential underutilized strategy is to link discipline to a waiver of claims. Here, the Judiciary exercised patience in providing the employee with many additional chances that clearly worked to its advantage. In these cases, settling disciplinary claims with a release can be an effective way forward for both the employer and the employee.

For more information regarding this decision and how to properly administer leaves of absence to avoid liability, please contact Harris S. Freier, Esq., Partner in the Employment Law & Litigation practice, via email here, or call 973.533.0777.