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Young v. Hobart West Group

December 15, 2005


On appeal from Superior Court of New Jersey, Law Division, Mercer County, Docket No. L-3489-02.

The opinion of the court was delivered by: John S. Holston, Jr., J.A.D.



Argued October 31, 2005

Before Judges Lintner, Parrillo and Holston, Jr.

Plaintiff, Carol A. Young, filed a four count complaint in the Law Division against defendants, The Hobart West Group (Hobart) and Larry Aitken, alleging wrongful termination from her employment as a regional executive (RE) for Hobart in violation of the New Jersey Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -42, in count one on the basis of her gender, in count two on the basis of her age (forty-eight), and in count three on the basis of retaliation for her alleged complaints concerning perceived disparate treatment in the payment of bonuses to branch managers based on their marital status. In count four, plaintiff alleged that defendants' acts constituted the intentional or negligent infliction of emotional distress. On October 8, 2004, after the conclusion of discovery, the Law Division granted defendants' motion for summary judgment, dismissing all four counts of plaintiff's complaint with prejudice. Plaintiff appeals from that order. We affirm.

Hobart is engaged in the business of providing staffing for businesses of permanent and temporary employees. The temporary staffing includes light industrial positions such as warehouse workers, forklift operators and material handlers.

Plaintiff, age forty-eight at the time of her termination, began working for Hobart as a general manager (GM) and at-will employee on January 30, 1999, by virtue of Hobart's acquisition of her former employer, Solutions Staffing, a company owned by Larry and Florence Walensky. At the time of acquisition, the Walenskys became employees of Hobart and reported directly to Fred Staudmyer, Hobart's president, who was age forty-five at the time of plaintiff's termination.

Plaintiff continued to report to the Walenskys in her position as GM and assisted them in managing their former branches and Hobart's branch in Jersey City. Plaintiff's duties included overseeing the operation of the Montclair, Edison, New Brunswick, Jersey City and Paterson branches, all of which were engaged primarily in light-industrial staffing, and ensuring compliance with Hobart's rules, regulations and sales requirements.

In October 2000, plaintiff informed Staudmyer that she had received a job offer from Stratus Services Group. Staudmyer told her that he wanted her to stay with Hobart, that she was important to the company, that he would promote her to RE, raise her annual salary from $62,000 to $88,000 and expand her management responsibilities. Plaintiff accepted Staudmyer's promotion offer, effective January 30, 2001, and became responsible for managing seven of Hobart's branches including five of the Walenskys' former branches. Plaintiff came under the supervision of Larry Aitken, age forty-one, who was named executive vice president responsible for Hobart's Connecticut, New York, New Jersey and Pennsylvania region, and who reported directly to Staudmyer, filling the role previously occupied by the Walenskys. Larry Curran was responsible for sales in Aitken's region before Aitken's January 2001 promotion. Therefore, when plaintiff began to report to Aitken in January 2001, Aitken, with no objection from plaintiff, made Curran sales manager, responsible for salespeople in all seven of the branches managed by plaintiff, thereby reducing plaintiff's workload. After Aitken and plaintiff were promoted, the Walenskys no longer participated in the management of their former branches.

Plaintiff acted as the buffer between Aitken and the branch managers. As RE, she had access to the financial information of the branches under her supervision. Plaintiff claims that she complained to Larry Walensky about greater bonuses going to married male employees than to unmarried male and female employees. However, Walensky contends that plaintiff never complained to him about any discriminatory bonus policies and denies ever relaying any of plaintiff's concerns to Staudmyer or Aitken. Plaintiff never told Aitken about her perception of sex and marital status discrimination taking place, but did discuss with Aitken the unfairness of the formula for awarding bonuses. Before plaintiff allegedly complained to Larry Walensky, Aitken proposed to Staudmyer on March 26, 2001, that Omar Rios, an unmarried branch manager, should receive a bonus because of his excellent performance. After plaintiff's discussion with Aitken, employees who plaintiff believed were not receiving proper bonuses received an increased bonus with Aitken's assistance.

During her tenure as RE, plaintiff and the Newark branch manager, Joaquin Colon, began to have problems. Plaintiff met with Aitken, who agreed to change the reporting relationship, as a result of which Colon began to report to Aitken instead of to plaintiff. Aitken claims that the change was a result of plaintiff's inability to work with Colon and Ricardo Ospina, the Newark sales manager. However, plaintiff testified that Aitken made the change because he felt that some Hispanic men do not like to report to female managers.

Because the employment economy in light-industrial staffing was poor in 2001, in the second quarter of 2001 Aitken and Curran designed a sales contest to stimulate branch performance. On April 10, 2001, Hobart's Board of Directors met to discuss first quarter staffing problems and concluded that a continuation in declining revenues may necessitate a reduction in staff. Because the sales contest did not do enough to spark revenue, the Board decided to analyze a means to reduce payroll. The minutes from the April 10, 2001, Board of Director's meeting state:

The Board reviewed the Key Items Report for the staffing business. The Board identified disappointing sales for Q4 2000 and Q1 2001. Fred Staudmyer noted that this was due to a meltdown in Q4 (down from 7% from Q3) which was partially due to the industry downturn and partially due to management. . . .

[T]he Board suggested that staff may need to be reduced if revenues did not turn around.

Because the company was under pressure in early 2001 to increase profits by boosting sales or reducing costs, according to Larry Walensky, the easiest and most effective approach was for the company to reduce the "head count" since payroll is the largest company expense. In April-June 2001, Staudmyer recommended to Aitken that he eliminate plaintiff's position as a cost reduction measure because of the declining profit margins in the staffing business, and light-industrial staffing in particular. At the July 18, 2001 Director's meeting, Staudmyer discussed the problems facing the staffing business in the first half of 2001. Staudmyer related that temporary workers were down 9.9% nationally in June 2001 from June 2000 and that reduced earnings and layoffs had become common in the industry. Staudmyer's presentation showed that sales in the company's light-industrial staffing, the primary focus of plaintiff's branches, were expected to decline 12% in 2001 and that the company began to reduce its headcount in the second quarter of 2001 to adjust.

On August 10, 2001, plaintiff was terminated by Aitken, who testified that the reason was "because sales were flat and margins were down." Plaintiff was told by Aitken that her termination was a "corporate decision" because of "economics." In deciding to terminate plaintiff, Aitken considered her performance deficiencies and the probability that he and the branch managers could absorb plaintiff's duties.

Plaintiff testified that she discovered that Larry Curran, a younger employee, and Aitken now performed her previous duties. Aitken stated that he did not know plaintiff's age at the time of her termination or during any period of his supervision of her. Defendants contend that plaintiff was not replaced but, rather, that her former supervisor and subordinates absorbed her duties, in essence eliminating a layer of management.

Several former co-workers told plaintiff after her termination that Aitken remarked that plaintiff's termination was a "mutual decision," that plaintiff was not a "long term" employee because she was going to retire soon and that the company sought employees "long term." Aitken contends that he explained to the branch managers that he terminated plaintiff to reduce costs, that he wanted the branch managers to stay "for the long haul," and that maybe plaintiff would now decide to retire to Montana. Plaintiff admitted that she and her husband intended to retire to Montana or Wyoming at some point because both enjoyed the outdoors and horseback riding and had discussed this dream for many years both at Solutions Staffing and Hobart. She had not made definite plans of going forward with retirement except that she hoped to do so in "five years" or as soon as her husband retired.

In April 2002, plaintiff began a full-time position for Joulé Staffing and in December 2003 filed her resignation effective March 26, 2004. Plaintiff claims that she made her final decision to retire due to health reasons, although neither of her doctors advised her to resign from Joulé. Plaintiff's husband retired from the Edison Police Department in August 2003, and they listed their New Jersey home for sale in February 2004 and subsequently finalized a contract to purchase a new home in Montana.

The motion judge granted defendants' motions for summary judgment "across the board." The judge determined that Hobart eliminated plaintiff's position due to business needs. The judge found that there was no age or gender discrimination, no retaliation, and no intentional infliction of emotional distress.

In reviewing summary judgment orders, we must decide whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve ...

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