Zive v. Stanley Roberts, Inc.
182 N.J. 436, 16 Am. Disabilities Cas. (BNA) 912, 867 A.2d 1133 (2005)
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Rule of Law:
To satisfy the second prong of a prima facie case for discriminatory termination under the Law Against Discrimination (LAD), a plaintiff only needs to show that they were actually performing the job prior to the termination. The quality of the employee’s performance is not considered at this initial stage.
Facts:
- In May 1991, Stanley Roberts, Inc. hired Victor Zive to lead its new 'Homeworld' division.
- Zive had substantial prior experience as a sales executive, and under his leadership, Homeworld's sales grew from $905,000 in 1991 to $2 million by 1994, before declining and then recovering to $1.8 million in 1997.
- Edward Pomeranz, the president of Stanley Roberts, set a sales goal of $2.5 million for 1998, stating the division needed to reach this amount to justify its existence.
- Homeworld's sales reached only $1.5 million in 1998, failing to meet the goal, but no one at Stanley Roberts suggested that Zive's job was in jeopardy.
- On December 3, 1998, Zive suffered a debilitating stroke that paralyzed the left side of his body, leaving him with a limp and slowed speech.
- While Zive was recovering and working from home, Pomeranz encouraged him to 'hurry up and get better and get back to work.'
- On March 8, 1999, Zive informed the Chairman of the Board he was ready to return to the office full-time and was immediately told his services were no longer required.
- After terminating Zive, Stanley Roberts issued a memo confirming the Homeworld division would continue, and another employee took over Zive's former job functions.
Procedural Posture:
- Victor Zive filed a lawsuit in a New Jersey trial court against Stanley Roberts, Inc., alleging discriminatory discharge in violation of the Law Against Discrimination (LAD).
- At trial, after Zive presented his case, Stanley Roberts moved for a directed verdict, arguing Zive failed to establish a prima facie case of discrimination. The trial court denied the motion.
- The jury returned a verdict in favor of Zive, awarding him compensatory and other damages.
- Stanley Roberts, as appellant, appealed the judgment to the Appellate Division.
- The Appellate Division affirmed the trial court's judgment, holding that Zive only needed to show he was 'objectively qualified' for his position.
- The Supreme Court of New Jersey granted Stanley Roberts's petition for certification.
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Issue:
Does an employee satisfy the second prong of a prima facie discriminatory termination claim under the Law Against Discrimination (LAD) by producing evidence that they were actually performing the job, regardless of whether that performance met the employer's specific expectations?
Opinions:
Majority - Justice Long
Yes. An employee fulfills the second prong of a prima facie case for discriminatory termination simply by showing they were performing in the position from which they were terminated. The court holds that the 'legitimate expectations of the employer' standard from prior case law was imprecise and created too high a burden, conflating the prima facie stage with the later stages of the McDonnell Douglas burden-shifting framework. The purpose of the prima facie case is to be a modest, low-threshold inquiry to determine if discrimination could be a reason for the termination. Requiring a plaintiff to prove they met subjective or even objective performance goals at this initial stage is an 'unnecessary redundancy.' Evidence of performance quality, such as failing to meet a sales goal, is more properly considered when the employer articulates its non-discriminatory reason for termination and the plaintiff attempts to show that reason is pretext.
Analysis:
This decision significantly lowers the initial evidentiary hurdle for plaintiffs in discriminatory termination cases in New Jersey. By clarifying that an employee need only show they were performing the job, not performing it well, the court makes it more difficult for employers to win early dismissals on motions for summary judgment or directed verdict. The ruling effectively shifts the battleground over performance-related issues from the prima facie stage to the pretext stage of the litigation. This ensures that more cases where poor performance may have been a contributing, but not the determinative, factor in a termination will reach a jury, aligning with the broad remedial purposes of the Law Against Discrimination (LAD).
