FAA preempts NJLAD: NJ court upholds employer's arbitration agreement

A former employee's claims filed under the New Jersey Law Against Discrimination (NJLAD) were subject to the arbitration agreement she signed when she was first hired, the Monmouth County Law Division recently ruled in a matter of first impression (meaning the matter had never before been addressed by the court). More specifically, the court said a recent amendment to the NLJAD that prohibits the waiver of any right or remedy available under the Act was superseded by the Federal Arbitration Act (FAA).

Facts

Karina Janco signed an arbitration agreement as part of her onboarding documents when she was hired by Bay Ridge Automotive. The agreement stated both "the employer and employee mutually consent to the resolution by final and binding arbitration of all disputes, claims or controversies of any kind between them," which include "claims for discrimination, harassment, and/or retaliation."

Janco later filed a lawsuit in state court alleging Bay Ridge had violated the NJLAD. The employer asked the court to dismiss the complaint and compel arbitration based on the agreement she had signed.