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New York Court of Appeals Broadens Scope of Punitive Damages Under NYC Anti-Discrimination Law

New York Court of Appeals Broadens Scope of Punitive Damages Under NYC Anti-Discrimination Law

Sex discrimination and pregnancy discrimination do not just affect the victims. As the New York City Council has said in adopting some of the country's strictest anti-discrimination laws, this type of conduct poses a “danger to the health, morals, safety and welfare of the city.” For that reason, the New York City Human Rights Law (NYCHRL) allows discrimination victims to seek punitive damages in addition to compensation for their direct injuries.

Punitive damages are meant to punish wrongdoing and deter future misconduct. These type of damages can be particularly effective against employers who routinely engage in discriminatory employment practices. For one thing, most business insurance policies will cover compensatory damages, but not punitive damages, meaning the employer is on the hook for the full amount.

Stricter Federal Standard Does Not Apply to City-Based Claims

When can a victim of sex or other discrimination actually seek punitive damages? The New York Court of Appeals was recently compelled to answer this question as the result of a federal lawsuit brought under the NYCHRL. The plaintiff and the defendants each advocated a different standard. A majority of the Court of Appeals ended up agreeing with neither side.

The plaintiff previously worked as a physical therapy aide for the defendants. She sued the defendants for pregnancy discrimination. A jury ruled in her favor and awarded over $60,000 in economic and non-economic damages.

The federal judge presiding over the case would not allow the plaintiff to ask the jury for punitive damages. The judge decided the standard for punitive damages under the NYCHRL was the same as Title VII, the law governing federal employment discrimination claims. According to the Title VII standard, the plaintiff needed to show the defendants “intentionally discriminated against her with malice or reckless indifference to her protected rights.” The judge said while the defendants may have broken the law–as the jury's verdict later confirmed–there was “no evidence of intent.”

The plaintiff appealed the judge's ruling to the U.S. Second Circuit Court of Appeals, which hears appeals from federal trials in New York. That court then decided to ask the New York Court of Appeals to answer the question, “What is the standard for finding a defendant liable for punitive damages under the New York City Human Rights Law?”

Before the New York court, the plaintiff argued that punitive damages should be available in all cases where a defendant is found liable for discrimination under the NYCHRL. The defense maintained that the trial judge got it right in applying the stricter Title VII standard. By a vote of 6-1, the Court of Appeals decided neither standard was appropriate. Instead, the majority said courts should follow the “common law” standard, meaning that a plaintiff can seek punitive damages in New York City when “the wrongdoer's actions amount to willful or wanton negligence, or recklessness, or where there is a conscious disregard of the rights of others or conduct so reckless as to amount to such disregard.”

Have You Been the Victim of Sex or Pregnancy Discrimination?

While the Court of Appeals did not adopt the even broader standard advocated by the plaintiff–although the lone dissenting judge agreed with her–the majority's ruling is still good news for victims of sex, race, and disability discrimination in New York City. Employers who recklessly engage in or support discriminatory conduct are now “on notice” that they may be liable for punitive damages. If you have been the victim of workplace discrimination and need advice regarding your legal options, contact the qualified New York employment lawyer at the Law Offices of Mahir S. Nisar today.

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