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How to Handle Being the Victim of Workplace Discrimination in New Jersey When Your Employer is an Entity Going Through Bankruptcy

A few years ago, a major insurance company ran an advertising campaign in which they counseled consumers to use them because of their vast knowledge borne out of their extensive experience. “We know a thing a or two because we’ve seen a thing or two,” the famous actor serving as a spokesperson helpfully explained. Selecting a New Jersey employment discrimination lawyer can involve some distinctly similar concepts.

In both situations, to best protect yourself, you need a well-seasoned professional who will know how to handle your circumstance, no matter how strange, novel, or unique, because they can call upon their vast catalog of first-hand experiences dealing with identical or similar situations successfully.

Having a knowledgeable and experienced discrimination attorney is never more important than when your case presents some unusual complexity. Take, for example, the federal discrimination case of T.E., an executive with a major nuclear power business who was 67 years old when he was fired at the end of May 2018.

The employer said that the firing occurred because of departmental restructuring. The vice president, however, believed a different reason motivated the termination: his age.

The vice president began the discrimination litigation process, filing a claim with the Equal Employment Opportunity Commission in July 2018.

There was, however, one significant wrinkle in T.E.’s case: his employer was going through Chapter 11 bankruptcy in the Southern District of New York. The employer had sent the vice president notices with information including the deadline for submitting claims for payment, along with other deadlines.

T.E. did not take any action to pursue his age discrimination claim within the bankruptcy case going on in the federal court in New York. Instead, he filed a separate age discrimination lawsuit, alleging violations of the Age Discrimination in Employment Act, in a different federal court in Pennsylvania.

What ensued was a novel question about what happens when employment discrimination intersects with an employer that is in bankruptcy. The opinion from the Third Circuit Court of Appeals (whose rulings directly control federal cases in New Jersey, Pennsylvania, and Delaware) lays out exactly what a discriminated worker in that kind of circumstance should and should not do.

As an initial matter, the court ruled that a potential damages award owed to a discriminated employee is an “administrative expense,” which means that the employee’s discrimination claim is something that cannot proceed free from, and independent of, the bankruptcy action. Because the discrimination occurred within the confines of T.E.’s employment, and T.E.’s employment was something that benefitted the company, it qualified as an administrative expense.

So it Was a Bankruptcy Administrative Expense. What Does that Mean for Me?

It means two very vital things, first and foremost. You have to seek your claim for discrimination damages with the bankruptcy court where the bankruptcy case is ongoing, and you may have an abbreviated length of time to do so.

Normally, an employee who is the victim of workplace discrimination has a length of time to file his/her claim that is spelled out in discrimination law — either the New Jersey Law Against Discrimination or federal law (depending on the statute underlying your complaint.) In a scenario where your employer is going through bankruptcy, you may have tighter deadlines created by something called the “bar dates” that the bankruptcy court creates. (“Bar dates” are deadlines after which the creditors of a debtor in bankruptcy, which includes discriminated employees of an employer in bankruptcy, are cut off from seeking payment.)

If the adverse employment action you suffered occurred after that bankruptcy deadline, you still have options. As the appeals court noted, the vice president could have gone to the bankruptcy court and challenged “the adequacy of the notice he received and whether discharge of his claim violated due process, which are arguments routinely reviewed by courts post-confirmation.” The key rule, however, was that a discriminated employee “may not litigate his underlying employment discrimination claim without filing a request for payment in the” bankruptcy court. That is the only way to get relief.

The more unusual your workplace discrimination case is, the more you need a legal team with the knowledge and experience to confront those peculiarities and still get you what you deserve. For that kind of powerful advocacy, along with the clear answers you need to the many questions you probably have, get in touch with the skilled New Jersey age discrimination attorneys at Phillips & Associates. We’ve taken on — and won — countless cases involving workers harmed due to their age, and we’re ready to get to work for you. Contact us online or at (609) 436-9087 today to set up a free and confidential consultation.

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