VIKTORIYA USACHENOK v. STATE OF NEW JERSEY DEPARTMENT OF THE TREASURY
Annotate this CaseNOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
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SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4567-18
VIKTORIYA USACHENOK,
Plaintiff-Appellant,
v.
STATE OF NEW JERSEY
DEPARTMENT OF THE
TREASURY, JOHN MAYO,
BULISA SANDERS and
DEIRDRE WEBSTER COBB,
Defendants-Respondents.
__________________________
Submitted November 4, 2021 – Decided February 28, 2022
Before Judges Fuentes, Gilson, and Gummer.
On appeal from an order, pursuant to a transfer from the
Superior Court of New Jersey, Law Division, Mercer
County, Docket No. L-1577-17.
Smith Eibeler, LLC, attorneys for appellant
(Christopher J. Eibeler, Lisa A. Hernandez and Mary H.
Smith, on the briefs).
Andrew J. Bruck, Acting Attorney General, attorney for
respondents State of New Jersey Department of the
Treasury, Bulisa Sanders, and Deirdre Webster Cobb
(Donna Arons, Assistant Attorney General, of counsel;
Adam Robert Gibbons, Deputy Attorney General, on
the brief).
PER CURIAM
Plaintiff Viktoriya Usachenok, a former Department of the Treasury
employee, challenges the facial validity of paragraph (j) of N.J.A.C. 4A:7-3.1,
a regulation prohibiting discrimination and harassment in public empl oyment
and governing the investigation of complaints about that conduct.
When plaintiff filed this action, the challenged paragraph required anyone
interviewed during an investigation "be directed not to discuss any aspect of the
investigation with others" and provided that failure to comply with that
confidentiality directive could result in disciplinary action. During the
pendency of this action, the Civil Service Commission (CSC) amended the
regulation to state that investigators would "request" confidentiality and to
remove the threat of disciplinary action for non-compliance. Despite the
amendment, plaintiff maintains N.J.A.C. 4A:7-3.1(j), even in its present form,
impermissibly restricts speech and is facially unconstitutional. Unpersuaded,
we reject plaintiff's challenge to N.J.A.C. 4A:7-3.1(j).
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I.
On or about May 26, 2016, plaintiff filed an internal complaint with the
Equal Employment Opportunity and Affirmative Action (EEO/AA) office in the
Department of the Treasury, alleging defendant John Mayo, who was plaintiff's
supervisor, had sexually harassed her and subjected her to a hostile work
environment. At that time, N.J.A.C. 4A:7-3.1(j) included a confidentiality
directive, underscored below:
All complaints and investigations shall be handled, to
the extent possible, in a manner that will protect the
privacy interests of those involved. To the extent
practical and appropriate under the circumstances,
confidentiality shall be maintained throughout the
investigative process. In the course of an investigation,
it may be necessary to discuss the claims with the
person(s) against whom the complaint was filed and
other persons who may have relevant knowledge or
who have a legitimate need to know about the matter.
All persons interviewed, including witnesses, shall be
directed not to discuss any aspect of the investigation
with others in light of the important privacy interests of
all concerned. Failure to comply with this
confidentiality directive may result in administrative
and/or disciplinary action, up to and including
termination of employment.
[N.J.A.C. 4A:7-3.1(j) (2016) (emphasis added).]
Consistent with N.J.A.C. 4A:7-3.1(j) as it then existed, defendant Bulisa
Sanders, the EEO/AA investigator assigned to plaintiff's complaint, advised
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plaintiff of the confidentiality directive and that she could be disciplined, up to
and including termination, if she disclosed any aspect of the investigation to
anyone. Plaintiff was instructed to execute a form in which she acknowledged
the confidentiality directive. Sanders also told other individuals interviewed as
part of her investigation about the confidentiality directive and possible
disciplinary action for a violation of the directive and had them sign
acknowledgment forms.
On July 21, 2017, plaintiff filed a lawsuit against the Department of the
Treasury, Mayo, Sanders, and another employee, alleging, among other things,
a hostile work environment, retaliation, and discrimination in violation of the
New Jersey Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -50, and
violations of the New Jersey Civil Rights Act (CRA), N.J.S.A. 10:6-1 to -2. On
October 29, 2018, plaintiff filed an order to show cause, seeking an order
declaring the confidentiality directive of paragraph (j) null and void and
enjoining the application of the directive. The following day, she filed a motion
for leave to amend the complaint to add a count seeking a judgment declaring
N.J.A.C. 4A:7-3.1(j) null and void.
In a decision placed on the record, the trial court denied plaintiff's request
for preliminary restraints enjoining the use and enforcement of the
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confidentiality directive of paragraph (j) but, with no objection from the State,
ordered witnesses in this case be told they were not precluded from answering
discovery or participating in depositions. The trial court granted plaintiff's
motion for leave to amend her complaint. Plaintiff subsequently filed a second
and third amended complaint.
Pursuant to Rules 1:13-4 and 2:2-3(a), the State moved to transfer to us
the seventh count of the third amended complaint, in which plaintiff sought
declaratory relief concerning N.J.A.C. 4A:7-3.1(j), arguing the Law Division
did not have jurisdiction to decide a challenge to the validity of a rule
promulgated by a state agency. The trial court granted that motion. Plaintiff
subsequently filed a fourth amended complaint.
The parties included in the appellate record a copy of only the fourth
amended complaint and did not include copies of the previous pleadings. We
understand from the parties' submissions that the declaratory-judgment relief
requested in the seventh count of the third amended complaint is now set forth
in the sixth count of the fourth amended complaint. In that count, pursuant to
the Declaratory Judgment Act, N.J.S.A. 2A:16-50 to -62, plaintiff seeks a
judgment declaring the confidentiality directive of N.J.A.C. 4A:7-3.1(j) to be
null and void as contrary to law, specifically the LAD, and public policy.
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On August 19, 2019, the CSC proposed to amend N.J.A.C. 4A:7-3.1(j).
Under the proposed amendment, instead of telling interviewees they had to
maintain confidentiality or be subject to disciplinary action, EEO/AA
investigators would "request, rather than direct, employees to keep all aspects
of an investigation confidential . . . ." 51 N.J.R. 1311(a) (Aug. 19, 2019). In
addition, the proposed amendment would eliminate the final sentence in
paragraph (j), regarding the imposition of disciplinary action for violating
confidentiality. Ibid. Pursuant to these revisions, EEO/AA investigators would
explain to people interviewed during an investigation "why it is important not
to disclose any aspect of the investigation to other persons without a legitimate
and substantial business justification." Ibid. According to the CSC, "[t]he
purpose of this subsection is to ensure the personal and/or privacy interests of
the complainant and/or witnesses are not thwarted during the investigative
process and to maintain the integrity of the investigation." Ibid. In proposing
the amended regulation, the CSC explained confidentiality requests would still
"highlight the importance of confidentiality during the investigative process[,]"
but eliminating N.J.A.C. 4A:7-3.1(j)'s penalty provision would avoid "a chilling
effect on potential claimants." Ibid. We subsequently stayed these proceedings
A-4567-18
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"to allow sufficient time for the process of the adoption of an amended
regulation to be completed."
The CSC adopted the amended version of N.J.A.C. 4A:7-3.1(j) on March
12, 2020, effective April 20, 2020. Paragraph (j) now provides:
All complaints and investigations shall be handled, to
the extent possible, in a manner that will protect the
privacy interests of those involved. To the extent
practical and appropriate under the circumstances,
confidentiality shall be maintained throughout the
investigative process. In the course of an investigation,
it may be necessary to discuss the claims with the
person(s) against whom the complaint was filed and
other persons who may have relevant knowledge or
who have a legitimate need to know about the matter.
In order to protect the integrity of the investigation,
minimize the risk of retaliation against the individuals
participating in the investigative process, and protect
the important privacy interests of all concerned, the
EEO/AA Officer/investigator shall request that all
persons interviewed, including witnesses, not discuss
any aspect of the investigation with others, unless there
is a legitimate business reason to disclose such
information.
[N.J.A.C. 4A:7-3.1(j) (emphasis added).]
The revised version of the regulation omits the language in the former version
requiring interviewees to "be directed not to discuss any aspect of the
investigation with others" and imposing "administrative and/or disciplinary
action, up to and including termination of employment" for "[f]ailure to comply
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with this confidentiality directive . . . ." Compare N.J.A.C. 4A:7-3.1(j), with
N.J.A.C. 4A:7-3.1(j) (2016).
On July 14, 2020, the State moved to dismiss plaintiff's appeal, contending
the recent amendment to N.J.A.C. 4A:7-3.1(j) rendered the appeal moot.
Plaintiff opposed the motion and cross-moved for attorney's fees and leave to
amend the complaint if we granted the State's motion. We denied the motion
and cross-motion.
Plaintiff contends the confidentiality language of N.J.A.C. 4A:7-3.1(j),
even in its current form, creates an unconstitutional prior restraint of state
employees' First Amendment right to freedom of speech and violates the
legislative policies behind LAD, specifically LAD's provisions regarding
retaliation, N.J.S.A. 10:5-12(d); contractual waivers, N.J.S.A. 10:5-12.7; and
contractual non-disclosure clauses, N.J.S.A. 10:5-12.8; and the public policy
behind the 2019 amendments to LAD. In response, defendants argue N.J.A.C.
4A:7-3.1(j) does not violate LAD or the policies behind it and is constitutional
because it does not restrict speech and even if it has an incidental effect on
speech, the State's interest in maintaining the integrity of EEO/AA
investigations outweighs the minimal burden a request for confidentiality places
on a state employee.
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II.
Courts "must construe a regulation to render it constitutional if the
regulation is reasonably susceptible to such a construction." Karins v. Atl. City,
152 N.J. 532, 546 (1998). "Regulations that 'come within the ambit of delegated
authority' are presumed to be reasonable unless the party challenging them
shows them to be 'arbitrary, capricious, unduly onerous or otherwise
unreasonable.'" In re Amends. & New Reguls. at N.J.A.C. 7:27-27.1, 392 N.J.
Super. 117, 133 (App. Div. 2007) (quoting N.J. Guild of Hearing Aid Dispensers
v. Long, 75 N.J. 544, 561 (1978)). We "defer to the interpretation of the agency
charged with [a] statute's enforcement . . . 'as long as it is not plainly
unreasonable.'" Ibid. (quoting Koch v. Dir., Div. of Tax'n, 157 N.J. 1, 8 (1999)).
"'[A]n administrative agency may not, under the guise of interpretation, extend
a statute to give it a greater effect than its language permits,' so 'regulations that
flout the statutory language and undermine the intent of the Legislature' are
invalid." Ibid. (quoting GE Solid State, Inc. v. Dir., Div. of Tax'n, 132 N.J. 298,
306-07 (1993)).
When interpreting a regulation, we follow "the principles of statutory
interpretation." Ibid. Just as when we interpret a statute, our goal when we
interpret a regulation is to determine the intent behind its creation. See
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DiProspero v. Penn, 183 N.J. 477, 492 (2005). To achieve that goal, we "start
with the words" of the regulation, Simadiris v. Paterson Pub. Sch. Dist., 466 N.J.
Super. 40, 45 (App. Div. 2021), and give them "their ordinary meaning and
significance," DiProspero, 183 N.J. at 492.
Applying those principles to the language of the revised regulation, we
discern no constitutional infirmity. We recognize "[t]he word 'request' . . . may
be used as a command or an entreaty depending upon the context in which the
word is inserted, and the circumstances attendant upon its use." Marx v. Rice,
1 N.J. 574, 582 (1949). Here, context demonstrates the term "request," as used
in paragraph (j), is exactly that – a request and not a command – and does not
create a confidentiality requirement. In fact, we know, as expressed by the CSC,
the intent behind the amended regulation was to eliminate a confidentiality
requirement and its potential chilling effect rather than create one. If the CSC
intended to create or maintain a confidentiality requirement, it could have left
unamended the language in the prior version of the regulation, "direct[ing]"
people not to discuss any aspect of an investigation under threat of
administrative or disciplinary action. Instead, it removed that language in its
entirety and replaced it with a permissive "request." The amended paragraph (j)
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reflects, at most, an "attempt[] to convince" and not an "attempt[] to coerce."
Okwedy v. Molinari, 333 F.3d 339, 344 (2d Cir. 2003).
Plaintiff's focus on the phrase "unless there is a legitimate business reason
to disclose such information" in the amended regulation is misplaced, and her
reading of its language is incorrect. Instead of creating mandatory
confidentiality, that phrase merely removes from the request for confidentiality
disclosures supported by legitimate business reasons. The request remains a
request.
Acknowledging the CSC removed the threat of administrative or
disciplinary action from paragraph (j), plaintiff now focuses on paragraph (k),
which was not amended, and contends it imposes sanctions for a breach of
confidentiality. Paragraph (k) provides:
Any employee found to have violated any portion or
portions of this policy may be subject to appropriate
administrative and/or disciplinary action which may
include, but which shall not be limited to: referral for
training, referral for counseling, written or verbal
reprimand, suspension, reassignment, demotion, or
termination of employment. Referral to another
appropriate authority for review for possible violation
of State and Federal statutes may also be appropriate.
[N.J.A.C. 4A:7-3.1(k).]
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Plaintiff did not mention paragraph (k) in her amended complaint. Even if she
had, paragraph (k) does not have the effect she now argues it has.
Reading the regulation as a whole, "this policy" in paragraph (k) clearly
refers to the State's policy of providing "a work environment free from
prohibited discrimination or harassment." N.J.A.C. 4A:7-3.1(a). The regulation
identifies actions constituting violations of that policy. See, e.g., N.J.A.C. 4A:7-
3.1(a)(3) ("It is a violation of this policy to engage in any employment practice
or procedure that treats an individual less favorably based upon any of the
protected categories referred to in (a) above."); N.J.A.C. 4A:7-3.1(b) ("It is a
violation of this policy to use derogatory or demeaning references reg arding a
person's race, gender, age, religion, disability, affectional or sexual orientation,
ethnic background, or any other protected category set forth in (a) above.");
N.J.A.C. 4A:7-3.1(c) ("It is a violation of this policy to engage in sexual (or
gender-based) harassment of any kind, including hostile work environment
harassment, quid pro quo harassment, or same-sex harassment."). The
regulation also identifies prohibitive behaviors. See, e.g., N.J.A.C. 4A:7-
3.1(c)(2) (providing examples of behaviors that may constitute sexual
harassment); N.J.A.C. 4A:7-3.1(h) (identifying retaliation against someone who
alleges discrimination or harassment, provides information in a discrimination
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or harassment investigation, or opposes a discriminatory practice, as being
"prohibited by this policy").
Not following the request for confidentiality in amended paragraph (j) is
not identified as either a violation of the policy or a prohibited behavior. And
given its permissive and not mandatory nature, as we determined above, it could
not be deemed to be a policy violation under paragraph (k). Even considering
plaintiff's arguments regarding paragraph (k), the plain language of the amended
paragraph (j) does not restrict speech and does not constitute an improper prior
restraint of speech.
We also find unpersuasive plaintiff's argument that the amended
regulation violates the legislative or public polices behind LAD. We discern no
conflict between the amended regulation and LAD. The amended regulation's
request for confidentiality is not a retaliatory act under N.J.S.A. 10:5-12(d), a
waiver of a substantive right in an employment contract under N.J.S.A. 10:5-
12.7, or a required non-disclosure clause in an employment contract or
settlement agreement under N.J.S.A. 10:5-12.8. It is exactly what the CSC says
it is: a request for confidentiality made in an effort to "ensure the personal
and/or privacy interests of the complainant and/or witnesses . . . maintain the
integrity of the investigation."
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Rather than violating the policies behind LAD, the amended regulation
supports them. Our Supreme Court has recognized "confidentiality is an
important component of any policy designed to maximize reporting of alleged
sexual harassment and to ensure the accuracy of ensuing investigations into such
allegations." Payton v. N.J. Tpk. Auth., 148 N.J. 524, 541 (1997). See also
Chai R. Feldblum & Victoria A. Lipnic, Select Task Force on the Study of
Harassment in the Workplace 43 (June 2016),
https://www.eeoc.gov/sites/default/files/migrated_files/eeoc/task_force/harass
ment/report.pdf (recommending "[i]nvestigations should be kept as confidential
as possible, recognizing that complete confidentiality or anonymity will not
always be attainable"). It is also generally accepted that confidentiality is
important to the integrity of ongoing investigations of all kinds. See, e.g., N.
Jersey Media Grp., Inc. v. Twp. of Lyndhurst, 229 N.J. 541, 551 (2017) ("[T]hat
the danger to an ongoing investigation would typically weigh against disclosure
of detailed witness statements and investigative reports while the investigation
is underway, under both [the Open Public Records Act] and the common law.").
A victim of sexual harassment must be protected from potential
retaliation. That protection can be possible only through an investigative
process that promotes an environment of trust. The system must also treat a
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person accused of misconduct in a fair and impartial manner. A request for
confidentiality promotes a fair investigatory process that protects both the
accuser and the accused while respecting the free-speech rights of all
participating in an investigation.
We reject and dismiss plaintiff's challenge to the validity of N.J.A.C.
4A:7-3.1(j). We hold that the current version of the regulation is enforceable.
We remand with instructions the trial court enter an order dismissing with
prejudice the count of the complaint in which plaintiff challenged N.J.A.C.
4A:7-3.1 (j). We do not retain jurisdiction.
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