New Jersey has enacted legislation (Senate Bill 1790) that expands its existing wage payment laws to, among other things, require a new notice and increase penalties for violations. Senate Bill 1790 is effective immediately.
Employer Notice:
Under Senate Bill 1790, employers must provide new and current employees a notice containing their rights under State Wage and Hour Laws, as well as instructions on how to file a claim. The New Jersey Department of Labor and Workforce Development will prepare a notice template for employers to use.
Enforcement:
Senate Bill 1790 adds new enforcement procedures and remedies that employers may face for violating wage and hour laws or for retaliating against employees who assert their rights. See the text of the law for a full description of these changes. A summary of a few of these changes follows.
Employees now have up to six years from the date of the violation to file a claim for wages owed under any state wage and hour law, including those related to unpaid minimum wages, unpaid overtime compensation, wages lost because of unlawful discharge, or other discriminatory acts taken in retaliation against the employee.
In addition, the law holds employers accountable for unpaid wages, benefits, or overtime by increasing damages and fines. For example, employees can bring an action against employers that violate state wage payment laws and recover not only unpaid wages, but also attorney's fees and costs, and in some circumstances, employees may be entitled to liquidated damages equal to 200% of wages owed.
Depending on the claim, employers could be fined between $500 and $1,000 and/or imprisoned up to 90 days for first violations. For additional violations, employers could be fined between $1,000 and $2,000 and/or imprisoned for up to 100 days. Employers will also face additional consequences for failing to show they've maintained proper records.
Note: Employers may not have to pay liquidated damages for a first violation if the employer:
- Demonstrates that the error was made in good faith and it had reasonable grounds for believing its actions were not a violation of the law;
- Admits the violation; and
- Pays the amount owed within 30 days.
Senate Bill 1790 also increases the enforcement powers of the Commissioner of the New Jersey Department of Labor and Workforce Development. For example, if an employer fails to comply with a final determination of the Commissioner or a judgment of a court to pay an employee any wages owed or damages awarded within 10 days of when the determination or judgment requires the payment, the Commissioner may issue:
- A written determination directing any appropriate agency to suspend one or more licenses held by the employer until the employer complies; and/or
- A stop work order against the violators requiring the cessation of all business operations.
Compliance Recommendations:
New Jersey employers should review their procedures and ensure they are properly compensating employees under the law.
Please contact your dedicated service professional with any questions.