A recent decision from the New Jersey Appellate Division, Affrunti v. Reed Smith LLP, provides important guidance on how the Diane B. Allen Equal Pay Act (NJ EPA) interacts with the New Jersey Law Against Discrimination (LAD), particularly with respect to the damages lookback period and the scope of comparator pay data that employers may be required to produce.
By way of background, Sherri A. Affrunti (Affrunti), a non-equity partner, sued her former employer, the law firm Reed Smith LLP, in New Jersey state court alleging unequal pay in violation of the NJ EPA, the LAD, and the New Jersey Wage Payment Act. Affrunti alleged that compared to similarly situated male partners, she received minimal bonuses and pay increases and that her salary was retroactively reduced by $50,000 in 2017.
The trial court held that Affrunti could seek damages only from July 1, 2018—the effective date of the NJ EPA—through January 11, 2019, the date of her resignation, reasoning that the NJ EPA does not apply retroactively. The court also limited discovery, ruling that Affrunti could only obtain comparator compensation data from Reed Smith’s New Jersey office and only for the same July 1, 2018 to January 11, 2019 period.
On appeal, the Appellate Division largely disagreed with the trial court’s approach. While it confirmed that the NJ EPA applies prospectively, the court held that the statute did not eliminate or shorten the LAD’s existing two-year lookback period for damages triggered by a discrete act of discrimination. As a result, Affrunti was permitted to pursue pay discrimination damages going back two years from the date she filed her complaint.
The Appellate Division also reversed the trial court’s limitation on discovery. It concluded that restricting comparator data to Reed Smith’s New Jersey office was unduly narrow and inconsistent with the purpose of the NJ EPA. The court determined that Reed Smith was a single employer with offices nationwide. Accordingly, Affrunti was entitled to discovery of comparator compensation data for all Fixed Share Partners nationwide from January 1, 2006 (when she became a Fixed Share Partner) through January 11, 2019 (when she left the firm).
Takeaways
This decision clarifies how the NJ EPA and LAD work together in pay equity litigation with respect to the applicable damages period and the scope of comparator pay data available in discovery. The ruling confirms that when an employer operates as an integrated entity, compensation data from locations nationwide may be relevant. The case also illustrates the value of thoroughly documenting compensation decisions and regularly reviewing pay practices to identify potential disparities.
This summary is for informational purposes only and is not intended to constitute legal advice. This information should not be reused without permission.