Is This Thing On? NJ Appellate Division Bars Employees’ Attempt to Use Secret Audio Recording In Support of CEPA and LAD Claims
Employees sometimes engage in questionable conduct to gather evidence to strengthen their claims of employment discrimination and retaliation. In Quinlan v. Curtiss-Wright Corporation and State of New Jersey v. Saavedra, employees misappropriated confidential employer documents to support their claims. More recently, in Stark v. South Jersey Transportation Authority, two employees surreptitiously voice-recorded a workplace conversation to support their claims under the New Jersey Law Against Discrimination (“LAD”). The Appellate Division, however, pressed the “STOP” button on the Stark plaintiffs’ efforts to utilize that recording as evidence, noting that recording violated the New Jersey Wiretap Act and failed to satisfy the seven-part balancing test established by the New Jersey Supreme Court in Quinlan for determining whether that violation nevertheless constituted “protected activity” under the New Jersey Law Against Discrimination (“LAD”).
Plaintiffs Stark and Ballistreri worked for South Jersey Transportation Authority (“SJTA”) in its toll audit division. Both plaintiffs had a history of abusing sick time, family leave, and vacation time and routinely failed to complete their monthly audit reports on time. In early 2006, Defendant Charles Giampaolo became plaintiffs’ manager. On two occasions, plaintiffs complained to SJTA’s Affirmative Action Officer about Giampaolo’s allegedly harsh manner of dealing with them. Notably, however, plaintiffs did not accuse Giampaolo of gender discrimination or sexual harassment. SJTA retained a private attorney to investigate plaintiffs’ complaints about Giampaolo. At the same time, SJTA requested its independent auditing firm, SMART Consulting, to complete plaintiffs’ delinquent audits. SMART concluded that plaintiffs were “seriously behind” in their work, and recommended that the toll revenue audit function be performed by non-union members in SJTA’s finance department because of the conflict of interest in having plaintiffs audit toll collectors who were fellow union members. SMART also recommended that SJTA eliminate plaintiffs’ job positions.
In February 2007, and prior to the conclusion of SJTA’s investigation, plaintiffs filed suit against SJTA and Giampaolo alleging that, among other things, Giampaolo had improperly referred to another employee as a lesbian and told a woman in the office who had worked there part-time that she should engage in inappropriate sexual conduct at her “bachelorette party.” Aside from these two allegations, there were no specific claims of sexual harassment or gender discrimination. Thereafter, the SJTA’s investigating attorney issued a report which concluded that plaintiffs had serious job performance issues and that Giampaolo’s conduct constituted neither harassment nor retaliation.
In April 2007, plaintiffs’ job positions were formally eliminated as per SMART’s recommendation. Because SJTA and plaintiffs’ union could not agree upon new positions for plaintiffs, each plaintiff was allowed to “bump” a less senior union member to fill an existing position. To that end, in May 2007, plaintiffs and union president Dominick Penn, met with Paul Heck, SJTA’s then-Human Resources Manager, and Wade Lawson, SJTA’s Deputy Executive Director to discuss possible new positions for plaintiffs. During the meeting, plaintiffs and Penn stepped out of the conference room multiple times to “caucus.”
Through plaintiffs’ discovery responses in the pending lawsuit, SJTA learned that plaintiffs were in possession of a CD containing certain recorded “admissions” made by Heck and Lawson during the “bumping” meeting in May 2007, which occurred while plaintiffs had stepped out to caucus. During her deposition, Stark claimed that she “unintentionally recorded” Heck and Lawson when she left her handbag in the conference room with the active recording device inside. In addition, Stark admitted that she initially assumed the recording was illegal but nonetheless shared it with her husband, an employee of SJTA, Ballistreri, and later with her attorney. Ballistreri, at her deposition, admitted she knew Stark was recording the meeting and also helped her prepare a draft summary of the recording for their attorney.
SJTA then charged plaintiffs with a willful violation of the New Jersey Wiretap Act and immediately suspended plaintiffs without pay, pending the outcome of a termination hearing. The hearing officer upheld the termination of Stark’s employment with SJTA, and reduced Ballistreri’s punishment to a four-week suspension, based on Ballistreri’s lesser involvement in the illegal recording.
The Appellate Division Decision
Plaintiffs appealed from the trial court’s order granting summary judgment to SJTA and dismissing their amended complaint alleging retaliatory termination in violation of the Conscientious Employee Protection Act (“CEPA”). Plaintiffs’ discrimination and retaliation claims under the LAD from their initial complaint had been previously dismissed by the trial court.
Plaintiffs’ argued on appeal that the trial court erred in excluding evidence of retaliation as embodied in the secret recording based on the trial court’s determination that the recording was illegal under the New Jersey Wiretap Act. The Appellate Division, however, affirmed the trial court’s ruling. The appellate court noted (1) Stark herself assumed that the recording was illegal; and (2) Ballistreri confirmed that she knew that Stark was secretly recording the meeting, and that she helped her draft a summary of the recording. “That both Stark and Ballistreri proffer to have unintentionally recorded the conversation we consider of little moment to the exclusion of the recording,” the Appellate Division concluded. The court held that the “initial intent to record” controlled, and plaintiffs’ alleged subsequent “forgetfulness” did not make their recording inadvertent. The appellate panel further found that, as required by the Wiretap Act, both Heck and Lawson had a “reasonable expectation of privacy” in their conversation which occurred behind closed doors.
The Court then addressed plaintiffs’ contention that, pursuant to the New Jersey Supreme Court’s decision in Quinlan, their secret recording was a protected activity, and that the trial court erred by using the illegality of the recording to distinguish the case from Quinlan and to exclude the recording. By way of background, in Quinlan, in an attempt to prove that her employer had engaged in sex discrimination by not promoting her, the plaintiff gathered over 1800 pages of confidential documents, which were available to her by virtue of her position in the Human Resources department, and gave them to her attorney. Shortly thereafter, Quinlan was terminated for breach of company policies and theft of company property. She then added a retaliation claim to her pending lawsuit, claiming that her employer had fired her in retaliation for engaging in “protected activity” in prosecuting her discrimination claim. The New Jersey Supreme court ultimately held that Quinlan had raised a jury question as to whether she had been terminated in violation of the LAD in retaliation for her attorney’s use of the documents in the litigation.
The Appellate Division quickly distinguished the instant case from Quinlan. The court noted that in Quinlan, the plaintiff had alleged specific acts of gender discrimination by her employer which brought her claims within the purview of the LAD. Here, however, the court found no such conduct had been alleged by plaintiffs. As such, “[t]hat alone warrants ending the analysis.” Nevertheless, the court went on to apply Quinlan’s balancing test, and found that almost every factor favored exclusion of the recording:
- the recording was obtained illegally, not innocently;
- Stark shared the recording not just with her attorney, but with her husband, a fellow SJTA employee at the time, and Ballistreri, also a fellow employee;
- the recording was of a private conversation;
- the violation here was of a law, not just company policy;
- the recording was disruptive and of minimal relevance;
- admitting the recording would set a poor precedent, creating an “untenable situation for defendant-employers who would have to deal with ‘plaintiffs left and right forgetting that they . . . just happened to have left [a] recorder in a room somewhere.’”
The Appellate Division concluded: “No benefit accrues to the broad remedial purposes of either LAD or CEPA by the admission of illegal secret recordings of private conversations.”
The Stark decision gives some comfort to employers that they can discipline an employee for blatantly illegal conduct without fear of being found liable for “retaliation” merely because the illegal conduct was undertaken to further the employee’s previously asserted claims. Employers in New Jersey must still tread carefully in this area, however, and employers would do well to consult with counsel as to whether the specific employee conduct at issue might be “protected activity” under Quinlan.
The Gibbons Employment & Labor Law Department regularly handles the defense of retaliation and discrimination claims in both state and federal courts. Please feel free to reach out to us with any questions regarding CEPA or whistleblower-related issues.