The state Supreme Court provided guidance Wednesday on the different proofs required for workplace-related claims under the Law Against Discrimination and the Conscientious Employee Protection Act.

An LAD claimant need only show a good-faith belief that the employer engaged in retaliatory conduct, even without proof of actual discrimination.

In order to succeed on a fraud-based CEPA claim, however, a plaintiff must reasonably believe that the complained-of activity was fraudulent.

The court also ruled that LAD plaintiffs seeking damages for future emotional distress must have evidence presented by expert witnesses.

The ruling, in Battaglia v. UPS, A-86/87-11, is a partial victory for a United Parcel Service supervisor who alleged he was demoted and assigned to the night shift after reporting other managers' actions that he thought violated UPS policy. They included making derogatory comments about women, misusing corporate credit cards and filing false expense reports in order to cover the costs of buying alcoholic drinks at lunches that stretched for hours.

After a month-long trial, a jury found LAD and CEPA violations and awarded Michael Battaglia $500,000 for economic losses and $500,000 for emotional distress. Superior Court Judge Phillip Paley reduced the emotional damages award to $205,000.

The Appellate Division affirmed the CEPA verdict, but vacated the LAD verdict and award of damages and ordered a new trial. The panel found no evidence that women at the company were actually discriminated against or were subject to a hostile work environment.

The Supreme Court reinstated the verdict, finding it was enough that Battaglia had a good-faith belief the company's actions were discriminatory.

"We … do not share the Appellate Division's understanding that the LAD only protects those who voice complaints about directly demonstrable acts of discrimination," Justice Helen Hoens said.

"[W]hen an employee voices a complaint about behavior or activities in the workplace that he or she thinks are discriminatory, we do not demand … that he or she be able to prove that there was an identifiable discriminatory impact upon someone of the requisite protected class."

As for Battaglia's CEPA claim, Hoens said that while he believed in good faith that the other employees were engaged in improper conduct, the statute clearly states that it is meant to combat fraud and criminal behavior.

"That is, the statute does not protect employees whose complaints are directed to minor or trivial matters," she said, finding Battaglia's allegations about misuse of corporate credit cards or falsified expense were reports of that ilk.

On the issue of damages for emotional distress, the court said expert witness testimony is required to show that the emotional distress is permanent or will have far-reaching effects.

"[A]lthough the humiliation, embarrassment and indignity suffered by the LAD plaintiff during the events complained of is obvious, once remedied through a verdict, any claim that those effects will endure so as to support a future award must be proven by credible, competent evidence lest that verdict be the product of speculation," she said.

Justices Barry Albin and Jaynee LaVecchia recused, along with temporarily assigned Appellate Division Judges Ariel Rodriguez and Catherine Cuff.

Appellate Division Judges Anthony Parrillo and Jose Fuentes joined Hoens, Chief Justice Stuart Rabner and Justice Anne Patterson in the opinion.

Battaglia's attorney is pleased with the ruling, even with the loss of the CEPA claim. "We still have damages under the LAD," says Maureen Binetti, of Woodbridge's Wilentz, Goldman & Spitzer.

Binetti says she understands the reasoning behind the court's finding that CEPA requires there to be certain proofs of fraud or criminal activity. "The court found that the activity here didn't rise to that level," she says.

UPS' lawyer, Michael Bissigner, of the Parsippany office of Day Pitney, did not return a telephone call seeking comment.