Close Enough? Who is “Similarly Situated” Under New Jersey Law Against Discrimination?

A recent decision by the Third Circuit Court of Appeals helps clarify who is a “similarly situated” employee in discrimination cases under the New Jersey Law Against Discrimination (“LAD”).  This is important since one way to prove discrimination is by showing the employer treated other similarly situated employees more favorably than the employee who is claiming he or she was the victim of discrimination.

Santos Andujar worked for General Nutrition Corporation (“GNC”) as a store manager for 13 years. After failing the company’s Critical Point Audits four years in a row, he received a failing score through the company’s Performance Evaluation Process (“PEP”).  On the day Mr. Andujar received his failing PEP score, GNC placed him on a “Red Store Action Plan” which gave him days to improve his job performance. Approximately one month later, the company fired him for failing to meet the Action Plan.  GNC replaced Mr. Andujar, who was 57 years old, with someone in his twenties.  Mr. Andujar then filed a lawsuit alleging that GNC had engaged in age discrimination in violation of the LAD.

The case went to trial.  GNC argued that it fired Mr. Andujar because of his poor performance and not because of his age.  However, Mr. Andujar presented evidence that five other store managers between 25 and 34 years old had failing PEP score, but GNC did not put any of them on an Action Plan, let alone fire them.

The jury concluded that GNC had discriminated against Mr. Andujar because of his age.  It awarded him a total of nearly $259,000 in damages — $123,926 in past economic losses, $60,000 in future economic losses, and $75,000 in emotional distress damages.

GNC appealed to the Third Circuit. It argued that, in light of the evidence of Mr. Andujar’s poor job performance, there was not enough evidence to support the jury’s conclusion that it fired him because of his age.  GNC claimed the five younger managers who received poor PEP scores were not appropriate comparators because some of them had worked for GNC only for a short time, none of them had engaged in the same misconduct as Mr. Andujar, and none of them had failed Critical Point Audits.  The company also argued that although one of the five comparators was an assistant manager, but in contrast Mr. Andujar was a store manager. 

 The Third Circuit rejected GNC’s arguments.  On April 12, 2019, in Andujar v. General Nutrition Corp., it explained that comparators have to be “similarly situated,” but not identical.  It found the five other employees were appropriate comparators to Mr. Andujar since they all were managers or assistant managers in the same geographic region who had the same level of responsibility as Mr. Andujar and had received failing PEP scores.  Accordingly, the appellate court concluded they were sufficiently similarly situated to Mr. Andujar that a jury could reasonably conclude that GNC fired Mr. Andujar because of his age.  It therefore affirmed the jury’s verdict.

In short, as the Third Circuit aptly put it, “[c]ompanies have the right to discharge their employees for poor performance, but they can’t excuse the shortcomings of younger workers while bringing down the hammer on older workers.”  In other words, the mere fact that Mr. Andujar’s job performance was poor did not doom his age discrimination case since GNC did not fire younger managers who had similar performance problems to him.