On October 5, 2021, Governor Phil Murphy signed A-681 thereby amending the New Jersey Law Against Discrimination (“LAD”) to provide new protections against age discrimination for applicants and employees over the age of 70 years old. Most notably for private employers, the amendments:
- Eliminate employer immunity from age discrimination claims for failure to hire applicants or promote employees over the age of 70; and
- Grant employees the ability to pursue all available remedies delineated under LAD, not just reinstatement, against employers who implement a mandatory retirement age.
Previously, New Jersey employers were able to refuse to hire or promote workers over 70 years old with impunity as LAD explicitly excluded such decisions from its protections. Further, LAD previously provided limited remedies for employees who were forced to retire due to their age. These former provisions were some of the very rare instances where LAD provided less protections to employees than the federal anti-discrimination laws.
New Jersey employers need to take heed of the amendments as the likelihood for exposure to potential liability for age discrimination is now heightened. With these new protections, an employer who decides not to hire or promote an individual over the age of 70 years old, despite having a legitimate, non-discriminatory reason, could still find itself defending against an age discrimination suit. Accordingly, employers should strive to ensure that all personnel decisions are well-documented, thoroughly reasoned, and not based on an individual’s age.
Further, despite the enactment of A-681, LAD still provides that it, “shall not be an unlawful employment practice to require the retirement of any employee who, for the two-year period immediately before retirement, is employed in a bona fide executive or a high policy-making position, if that employee is entitled to an immediate non-forfeitable annual retirement benefit from a pension, profit sharing, savings or deferred retirement plan, or any combination of those plans, of the employer of that employee which equals in the aggregate at least $27,000.00[.]” See N.J.S.A. 10:5-12(a). This provision, which shields employers from liability for implementing mandatory retirement policies in the above circumstances, seems to contradict A-681’s intent to eliminate age discrimination in the workplace given that the aforementioned provision, in practice, disparately impacts older employees. Given this inconsistency, one practical effect of A-681 is that employers will likely cease implementing any mandatory retirement practices (whether formal or informal) as they could be subject to the full range of penalties allowable under LAD.