Commercial Division Blog

Posted: December 28, 2022 / Written by: Jeffrey M. Eilender, Samuel L. Butt, Seth D. Allen, Joshua Wurtzel, Hillary S. Zilz / Category Employment Discrimination and Retaliation

Allegations of Adverse Employment Action After Employee Resigned May Support Retaliation Claim

In a Decision and Order, dated November 28, 2022, in Ja Kao v. Onyx Renewable Partners L.P., Index No. 654411/2021, Justice Margaret Chan of the New York County Commercial Division granted plaintiff who asserted claims for, among other things, retaliation under New York State Human Rights Law and New York City Human Rights Law leave to amend her complaint against certain defendants to fix a prior deficiency and allege a causal connection between the asserted protected activity and the alleged adverse employee action taken after she submitted her notice of resignation. The Court explained:

The next issue is whether the proposed FAC is sufficient to state a claim for retaliation against the defendants. Under the NYSHRL and NYCHRL (Executive Law § 296[1][e]; Administrative Code of the City of NY § 8-107[7], it is unlawful to retaliate against an employee for opposing discriminatory practices. To make out a claim for retaliation under the NYSHRL, a plaintiff must show that (1) she was engaged in a protected activity; (2) her employer was aware that she participated in that activity; (3) she suffered adverse employment action based on her activity; and (4) there is a causal connection between the protected activity and the adverse action (Forrest, 3 NY3d at 312-313) or an action that disadvantaged plaintiff (Harrington v City of New York, 157 AD3d 582, 585, 70 N.Y.S.3d 177 [1st Dept 2018] [internal citations omitted]).

Here, the proposed FAC sufficiently alleges the elements of retaliation such that the motion to amend to add this claim should be granted as to defendants. Specifically, plaintiff alleges that she informed her colleague Fletcher, who was made interim CFO following her resignation, that she was considering legal action for gender discrimination; that plaintiff shared her concerns about her treatment after the consummation of the Hampshire Transaction with Onyx's director of HR; that Khan asked Fletcher for information about plaintiff immediately after she submitted her notice of resignation on April 23, 2021; that following the notice, plaintiff was quickly presented with a highly unfavorable Proposed Transition Agreement between her and ORP GP that specifically required her to release her claims under the NYSHRL and NYCHRL; that plaintiff's treatment by various colleagues worsened after she submitted her notice of resignation; that after she expressly complained about discrimination on May 17, 2021, she was constructively discharged almost immediately by Khan on behalf of ORP GP; and that she was denied severance and payment for her non-permanent Black Onyx Units and stripped of her permanent units (NYSCEF # 117, ¶¶ 65, 78-101; 109-114).

Thus, in contrast to the original complaint, the proposed FAC adequately alleges a causal connection between the protected activities which were closely followed in time by the alleged adverse actions or actions that disadvantaged plaintiff. Furthermore, plaintiff need not plead that an Onyx's employee told defendants of her concerns about gender discrimination since an inference can be made from the facts alleged as to their knowledge (see Zann Kwan v Andalex Group LLC, 737 F3d 834, 844 [2d Cir. 2013] [for the purpose of establishing a prima facie cause of retaliation a plaintiff may rely on general corporate knowledge of her protected activity] [internal citation and quotation omitted]). As for defendants' assertion that the adverse actions alleged by plaintiff, including her constructive discharge, are attributable to her resignation, as opposed to protected activities, such assertion is insufficient to support a finding that the proposed retaliation claim is without merit (see Williams v New York City Hous. Auth., 61 AD3d 62, 71, 872 N.Y.S.2d 27 [1st Dept 2009] [holding that "no challenged conduct [under the NYCHRL] may be deemed nonretaliatory before a determination that a jury could not reasonably conclude from the evidence that such conduct was, in the words of the statute, 'reasonably likely to deter a person from engaging in protected activity.'"]).

Decisions an employer makes, even after an employee resigns, can be a basis for claims of retaliation under New York City and State law. The attorneys at Schlam Stone & Dolan frequently counsel employers and litigate claims relating to discrimination and retaliation. Contact our attorneys at commercialdivisionblog@schlamstone.com if you or a client have questions regarding these issues.