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Sexual Discrimination in Contractual Relationships

The New Jersey Law against Discrimination (The "LAD") has been described as a "civil rights statute," one of the more far reaching employment statutes in the United States. The mandate from the legislature, consistently reaffirmed by our courts, is to interpret the law against discrimination broadly and liberally, in order to achieve its purpose. Its purpose has been best described as that of eradicating "the cancer of discrimination." To this end, the LAD has been from time to time revised and expanded, sometimes by legislative intent, sometimes by reasonable court interpretation. Most of the attention paid by the Courts under the LAD has been directed to employment relationships as opposed to the other relationships the LAD governs, such as those involved in housing, obtaining loans, etc.

Two of the "under used" provisions of the LAD are the subsection which states that it is illegal to discriminate on the basis of any of the protected classifications (sex, race, etc.) in a "contractual" relationship and the closely related provision which prohibits discrimination in regard to entering and using places of "public accommodation." Some fact patterns involve both, such as the refusal of the part of the merchant to sell to someone against whom they have a racial, sexual or other type bias. This would constitute not only a denial of fair service since the business is a place of public accommodation, but would also constitute a violation of the prohibition against discrimination in the course of a contractual - in this case potential contractual - relationship.

We've certainly filed our fair share of cases alleging discrimination in these non-employment situations, but we have never had the need to go to the appellate division of our state on any of those cases, which have either settled or been tried to a conclusion without further appellate activity.

Further, all biased harassment is discrimination, but not all discrimination is harassment. Biased harassment is one type of discrimination, but there are many types of discrimination. If I am a bigot who has a problem with people of a different ethnicity, there are different ways that I can make that bigotry felt. I can harass the person while treating them otherwise fairly in the terms and the conditions of my relationship with them, or, on the other hand, I can be respectful and polite to their face while under-paying them or under-compensating them in other ways, for example. Those are two opposite sides of the same coins.

Of course, many fact patterns involve both.

In the context of "contractual" discrimination, however, there has never been a case that has held that sexual harassment is an example of the type of "discrimination" prohibited in the actual or pending contractual relationship. Put bluntly and clearly, if I refuse to buy my products from a female business owner because she will not sleep with me, for example, am I guilty of sexual harassment as a form of illegal discrimination? Our appellate court has answered that question with a clear "yes."

The recent decision in J.T's Tire Service vs. Untied Rentals North America Inc. has held that a refusal to do business because of a failure to enter to a "quid pro quo" sexual relationship is a type of sexual harassment and thus a type of illegal discrimination under our LAD. It's a decision the plaintiff's employment bar applauds, because it makes sense.

If a legitimate business owner is trying to pay their taxes, employ their workers and make a living to support themselves and their family, shouldn't she be free of the type of pressure that requires sex in order to do business? Once again, the "freedom" to be free of bigotry is not an illusion. It is something that we need to remember means different things to different people. It'd a lot easier for a Christian white male to say that there is "too much" ruckus about discrimination than it is for an African American, lesbian, disabled female to make the same observation. Perceptions mean everything. Our democracy means nothing unless we protect the most vulnerable of our citizens, and unless we adhere to principal.

I applaud this decision, because it was the right one, one more paving stone on the journey to justice.

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