New Jersey Jury Awards $51 Million in Age Discrimination Case: A Shocking Reminder for Employers to Tread Carefully
On January 26, 2017, a federal jury sitting in Camden, New Jersey awarded 66 year old Robert Braden a whopping $51.1 million in damages against his former employer Lockheed Martin Corporation. Mr. Braden was not a high-level executive; instead, he was a mid-level manager who had been employed by Lockheed Martin for 28 years. He was discharged as part of a company-wide reduction in force ("RIF"). The majority of the jury's award was for punitive damages, which amounted to nearly $50 million. New Jersey's Model Jury Charge instructs juries that punitive damages are not to be awarded as "routine." Instead, punitive damage awards are meant to "punish a wrongdoer and to deter the wrongdoer from similar wrongful conduct in the future." Indeed, courts instruct juries to award punitive damages only in "exceptional" cases, where there has been "especially egregious or outrageous" conduct. The standard for awarding punitive damages under New Jersey law is by "clear and convincing evidence."
Undoubtedly, Lockheed Martin will appeal this decision. But it is interesting to dissect what might have motivated the jury to find, by clear and convincing evidence, that the circumstances in Mr. Braden's case were "exceptional" and that Lockheed Martin acted "maliciously" or "in wanton or willful disregard of Braden's rights."
Braden's counsel presented the following salient facts to the jury:
- There were six people in Braden's unit that were potentially eligible for the RIF and Braden, at 66, was the oldest employee.
- Two other employees with the same job title as Braden were not terminated. Both were substantially younger than Braden at 42 and 38.
- While the employer had a RIF policy, it did not follow the policy with respect to Braden.
- Braden offered evidence that older employees consistently received lower reviews and raises than younger employees.
- Braden offered evidence of "stray remarks" – ageist comments made from time to time by his supervisors or other managers or executives in the company.
- The Lockheed Martin employees who testified on behalf of the company offered differing versions of why Braden was selected versus the younger employees.
- One year after the RIF, Lockheed Martin hired a new younger employee for Braden's position.
Lockheed Martin defended the termination decision, citing Braden's less favorable reviews. It also tried to distinguish the positions held by the two younger employees. It argued the responsibilities, duties and skill sets were different, and only titles were the same. It appears the jury did not accept this argument wherein, it appeared the only difference among the employees was age.
The Braden case is a cautionary tale to employers. It is important that employers:
- not only have written policies for RIFs, but follow them;
- have consistent application of employment policies and position descriptions;
- have demonstrably objective criteria for the termination decision;
- have several eyes on the decision – not just the direct supervisors who may not see the big picture or appreciate the substantial risk to the company of getting the analysis wrong;
- look at the facts from the employee's perspective, not just the company's viewpoint, as a jury is going to hear both, so engaging in the "devil's advocate" analysis is crucial; and
- engage legal counsel, well-versed in RIFs and employment law, as early in the process as possible.
If your company is planning single or multiple employee terminations, or if you have any other employment concerns, please contact Vanessa Kelly at (609) 785-2926 | firstname.lastname@example.org, or another member of Clark Hill's Labor and Employment Practice Group.
FAQs: Mandatory COVID-19 Vaccines and the Automotive & Manufacturing Industries
The Basics: A Quick, But Important, Primer on Handling Fidelity Bond Claims Webinar
Tea & Tidbits: Benefits Strategies for Small Employers
June’s discussion will center around benefit strategies for start-ups or employers who are small and aren’t sure if they can offer benefits at all.