New Jersey’s recently passed Wage Theft Act (“WTA”) somewhat flew under the radar. However, it will likely have seismic repercussions for employers operating in New Jersey, and because it is arguably the toughest legislation of this type in the U.S., it will make New Jersey a destination venue for wage and hour class action litigation.
- The law took effect effective of its passage on August 6, 2019.
SUMMARY OF KEY PROVISIONS
The primary and immediate impact of the Act’s amendments to various wage-payment laws is the institution of increased penalties for failure to pay wages, including criminal punishments. Below is a summary of the Act’s key provisions:
- Amends key provisions to NJ’s Wage Payment Law, the Equal Pay Act, and the Wage and Hour Law.
- With amendments to each of these laws, the Act provides that if an employer is found to owe wages to an employee that is due unpaid wages or wages lost due to the retaliatory action, the employee is allowed to recover:
- The wages owed
- Plus liquidated damages in an additional amount equal to 200 percent of the unpaid wages
- Plus reasonable costs of the action and attorney’s fees to the employee
- Includes critical employee protections and harsher employer penalties than those previously in place.
- Significantly extends the statute of limitations for minimum wage and overtime claims from two years to six years
- This substantially increases an employer’s exposure for non-compliance.
- Requires employers to provide current and newly hired employees with written notice of their rights under New Jersey’s wage and hour laws and an explanation of how to file a claim in the event of a violation.
- The NJ Department of Labor and Workforce Development will be preparing a model notice for use.
- Expands the definition of “employer” to include any successor entity or successor firm of the employer, meaning that a successor entity can also now be liable for the purported wage violations of its predecessor.
INCREASED CIVIL PENALTIES
Under the WTA, violating employers are subject to greater civil penalties. Of particular note is that the WTA now provides for treble damages and:
- A violator must pay wages owed plus liquidated damages equal to 200% of wages owed.
- The WTA imposes fines of $500 and 20% of the owed wages for a first offense (which increase to $1,000 and 20% of the owed wages for each subsequent offense), and administrative penalties ranging from $250 for a first violation to $500 for every subsequent violation.
CRIMINAL PENALTIES
Employers found to have violated New Jersey’s wage laws are also subject to criminal penalties. A violating employer commits a disorderly person’s offense, and, based on the number of violations, must pay fines ranging from $500 to $2,000 and/or serve jail time of 10 to 100 days.
PRESUMPTION OF RETALIATION
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Under the WTA, any employer that takes an adverse action against an employee within 90 days of the employee’s filing a wage complaint will automatically face a presumption that the employer’s action was retaliatory for having filed the complaint. This presumption “may be rebutted only by clear and convincing evidence that the action was taken for other, permissible, reasons.”
- An employer who is found to have retaliated against an employee for filing a complaint commits a disorderly persons offense and, upon conviction, will be subject to a disorderly persons offense, fines in the range of $100 to $1,000, payment of the employee’s lost wages, damages and reasonable costs of the action to the employee.
- If the employee was discharged, an employer who is found to have retaliated will be required to offer reinstatement plus pay:
- A fine of $100 to $1,000
- The employee’s lost wages
- Damages equal to 200% of the lost wages
- Reasonable employee costs, such as attorney fees
PUBLIC DISCLOSURE OF VIOLATORS
The WTA provides that a public website maintained by the New Jersey Department of Labor and Workforce Development will list each wage claim in which an employer is found to be in violation of one or more state wage and hour laws in a final determination by the commissioner of Labor and Workforce Development or a court judgment.
These listings will contain information including, but not limited to:
- Name and address of the employer
- Nature of the claim
- Number of affected employees
- Amount of wages owed
- Penalties resulting from the wage claim
RECOMMENDED NEXT STEPS BY EMPLOYERS
- Review this new law with all departments/functions related to compliance with it
- Ensure the requirements summarized in 5. above are met
- Conduct an audit for compliance with all New Jersey’s wage laws
For more information:
- E mail Trinity at info@TrintyHR.net
- Visit our website at www.TrinityHR.net
- Call us at 856.905.1762 or Toll Free at 877.228.6810
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