Five Employment Laws Every Manager Should Be Aware of in New Jersey

Five Employment Laws Every Manager Should Be Aware of in New Jersey

It is important for managers to know New Jersey employment laws for several reasons, including the following:

  1. Compliance: Managers are responsible for ensuring that their organization complies with all relevant employment laws. Failure to comply with these laws can result in legal action, fines, and other penalties. Therefore, it is important for managers to have a thorough understanding of New Jersey employment laws to ensure that their organization is in compliance.
  2. Risk Management: Knowledge of employment laws can help managers identify potential legal risks and take proactive measures to mitigate those risks. This can include developing policies and procedures that are compliant with the law, training employees on their rights and responsibilities, and documenting employment decisions to help defend against legal challenges.
  3. Employee Relations: Understanding employment laws can help managers create a positive and respectful workplace culture that supports employee well-being and productivity. For example, managers who are knowledgeable about anti-discrimination laws can help prevent discrimination and harassment in the workplace, which can improve employee morale and retention.

Throughout the rest of this article, we will walk through the five employment laws every manager in New Jersey should be aware of. 

1. New Jersey State Wage and Hour Law

The New Jersey Wage and Hour Law is a set of regulations that governs the payment of wages and overtime for employees in the state of New Jersey. The law establishes minimum wage rates and requires that most employees be paid overtime pay at a rate of one and one-half times their regular rate of pay for all hours worked over 40 in a workweek.  

It is important for managers to be aware of the New Jersey Wage and Hour law because they are responsible for ensuring that their company complies with these regulations. Failure to comply with the law can result in penalties, fines, and legal action in court or the New Jersey Department of Labor.  

The New Jersey Wage Payment Law (NJWPL) is a state law that outlines the requirements for paying wages and compensation to employees. The law applies to all employers in New Jersey, regardless of their size or industry, and covers hourly and salaried employees.

Under the NJWPL, employers are required to:

  1. Pay employees their wages on time: Employers must pay their employees at least twice per month, and the pay periods must be no more than 10 days apart. In addition, employers must pay employees for all wages earned within a certain pay period no later than 10 days after the end of that period.
  2. Pay employees the correct amount: Employers must pay employees the agreed-upon rate of pay for the work they have performed, and cannot make unauthorized deductions from their paychecks. Additionally, employers must provide employees with a statement of earnings that shows the hours worked, the rate of pay, and any deductions.
  3. Provide employees with notice of their pay rate: Employers must provide employees with written notice of their pay rate and the method of payment, either at the time of hire or within 30 days of the start of employment. If the pay rate changes, employers must provide employees with written notice of the change at least one pay period before it takes effect.
  4. Pay terminated employees in a timely manner: Employers must pay terminated employees their final wages within a certain time frame, depending on the circumstances of the termination.

2. New Jersey Whistleblower Law 

In general, the main whistleblower law in the State of New Jersey is the New Jersey Conscientious Employee Protection Act (“CEPA”).  CEPA is a state law that protects employees from retaliation by their employers for reporting or objecting to illegal or unethical activities in the workplace. The law is designed to encourage employees to speak up about wrongful conduct by their employers without fear of retaliation.

CEPA prohibits employers from retaliating against employees who disclose or threaten to disclose any activity or practice they reasonably believe is illegal, fraudulent, or harmful to public health or safety. It also protects employees who refuse to participate in activities that they reasonably believe to be illegal, fraudulent, or harmful.

It is important for managers to know about CEPA because they have a responsibility to ensure that their company is complying with the law and that employees are protected from retaliation.

In addition, knowing about CEPA can help managers create a culture of ethics and compliance within their company. By promoting a workplace culture that values ethical conduct and encourages employees to report concerns, managers can help prevent illegal or unethical conduct from occurring in the first place.

3. New Jersey Law Against Discrimination (LAD) 

The New Jersey Law Against Discrimination (LAD) is a state law that prohibits employers from discriminating against employees or job applicants based on certain protected characteristics. The law applies to employers of all sizes and covers a wide range of employment practices, including hiring, firing, promotions, and compensation.

The protected characteristics under the LAD include race, color, national origin, ancestry, age, sex, gender identity or expression, sexual orientation, religion, disability, and marital status. The law also prohibits discrimination against individuals who are pregnant or have a pregnancy-related condition.

The LAD prohibits several types of discrimination, including disparate treatment, which occurs when an employer treats an employee or job applicant differently because of a protected characteristic, and disparate impact, which occurs when an employer’s policies or practices have a disproportionately negative effect on individuals with a protected characteristic.

The LAD also requires employers to provide workplace accommodations for employees with disabilities, such as modified work schedules or equipment, to enable them to perform their job duties.

It is important for managers to know about the LAD because they have a responsibility to ensure that their company is complying with the law and that employees are not subject to discrimination.

Additionally, managers who are aware of the LAD can help create a workplace culture that values diversity, equity, and inclusion (DEI). By promoting an inclusive workplace, managers can help ensure that all employees are treated fairly and that the company benefits from the diverse perspectives and experiences of its workforce. 

4. New Jersey Family Leave Act (NJFLA)

The New Jersey Family Leave Act (NJFLA) is a state law that provides eligible employees with job-protected leave for certain family and medical reasons. The NJFLA applies to employers with 30 or more employees and covers eligible employees who have worked for their employer for at least 12 months and for at least 1,000 hours during the previous 12 months.

Under the NJFLA, eligible employees are entitled to up to 12 weeks of job-protected leave in a 24-month period for any of the following reasons:

  1. The birth, adoption, or foster care placement of a child
  2. To care for a family member with a serious health condition
  3. To recover from the employee’s own serious health condition

It is important for managers to be aware of the NJFLA so they can take steps to ensure compliance with the law, such as developing policies and procedures for requesting and approving leave, providing employees with required notices and forms, and training supervisors and managers on the requirements of the law.

5. New Jersey Equal Pay Act (NJ EPA)

The New Jersey Equal Pay Act (NJ EPA) addresses wage discrimination based on gender. The law prohibits employers from paying unequal wages to employees of the opposite sex for substantially similar work unless the wage differential is based on seniority, merit, quantity or quality of production, or any other factor other than sex.

The NJ EPA requires that employers provide equal pay for equal work, regardless of the job title or position held by the employees. The law applies to all employers, regardless of size, and covers all employees, including part-time, full-time, temporary, and seasonal employees.

The NJ EPA provides employees with a private right of action to sue their employers for wage discrimination. If an employee prevails in a wage discrimination claim under the NJ EPA, they may be entitled to recover lost wages, liquidated damages, and attorney’s fees.

A New Jersey Employment Attorney Can Ensure You’re Compliant  

Keeping track of the dynamic and evolving changes in employment laws is an important part of running a successful business. CMS employment attorneys understand how critical employment matters are to keeping your business running smoothly and with business goals in mind, CMS attorneys provide employers and business owners with important practical and preventative strategic legal advice to minimize risk and help them avoid potential liability.  And, if necessary, our employment attorneys act as strong advocates in defending employers when litigation arises.  If you need an employment attorney to help you navigate through the employment laws in the State of New Jersey, please contact Curcio Mirzaian Sirot LLC.   

Are Severance Packages Negotiable?

Are Severance Packages Negotiable?

When there is a layoff, reduction in force, or termination of employment, employers will frequently offer employees severance pay. Generally, this will be memorialized in a severance agreement that requires the employee to, among other things, release any and all legal claims that the employee may have against the employer in exchange for the severance pay. In many instances, severance agreements include non-disparagement, confidentiality, non-compete, and non-solicitation clauses. As such, it is vital that employees retain legal counsel from an experienced employment attorney to ensure that they fully understand their obligations under the agreement as well as any rights that they may be waiving.

Severance Agreements: What Are They? 

At its core, a severance agreement is an agreement between an employer and the departing employee where the departing employee releases potential legal claims against the employer in exchange for receiving monetary benefits to which the employee would not otherwise be entitled.  

The severance agreement is valuable to both an employer and an employee. From an employer’s perspective, obtaining a release of potential legal claims by the departing employee is the only vehicle that assures that the departing employee will not bring legal action against the employer regarding the employee’s separation of employment. From an employee’s perspective, severance allows the employee to obtain additional compensation while transitioning to new employment. 

Can Severance Packages Be Negotiated?

Yes, severance packages can be negotiated however it often depends on the circumstances surrounding the employee’s separation of employment. Indeed, it is important for a separated employee to understand whether the severance package offered is fair and reasonable. That is why it is important to retain an experienced, trusted employment attorney.  

How to Negotiate a Severance Package 

When it comes to negotiating a severance package it is important to follow and understand the following four steps. 

Step 1: Retain an Employment Attorney to Review the Severance Package and Handle the Severance Negotiations 

It is important to understand the legal terms contained in any proposed severance agreement. Most notably, it is important for the separated employee to have a full understanding of the legal rights they may be waiving by signing the severance agreement. Therefore, it is vital that the separated employee retain an employment attorney to explain the same to them.

In addition, it is important for the separated employee to retain an employment attorney to provide an analysis of whether the employee has any potential claims of discrimination, retaliation, harassment, wrongful termination, or the like. If so, the separated employee may have valuable leverage to use in the severance negotiations.   

Step 2: Negotiate the Monetary Severance Terms  

Based on the facts pertaining to the separation of employment, legal counsel for the separated employee may be able to negotiate a better severance benefit for the employee. For example, if the circumstances surrounding the termination may be construed as unlawful, the separated employee’s employment attorney may be in a better position to negotiate a more favorable monetary severance package.  

Step 3:Negotiate the Non-Monetary Severance Terms 

In addition to a general release of claims, severance agreements usually contain other important non-monetary terms as well. As set forth above, such terms typically include non-disparagement, confidentiality, non-compete, and non-solicitation clauses. Depending on the circumstances surrounding the separation of employment, these terms may be important to the separated employee. Accordingly, it is important for the separated employee’s employment attorney to negotiate the non-monetary terms of the severance agreement as well.  

Step 4: Finalize the Severance Package

The final step is to finalize the severance package. Once all the terms of the severance package have been finalized, the severance terms are memorialized in the severance agreement. It is important for the separated employee to review the severance agreement with their employment attorney so that the separated employee is comfortable with the severance agreement and understands the terms of the severance package as set forth in the severance agreement. Once that occurs, the separated employee and a representative of the employer sign the severance agreement, which generally makes the severance agreement binding.   

Will Non-Compete Agreements Be Banned in New Jersey?

Will Non-Compete Agreements Be Banned in New Jersey?

Under New Jersey law, non-compete agreements are valid and enforceable if they are “reasonable in view of all the circumstances of a particular case.”  Solari Indus., Inc. v. Malady, 55 N.J. 576 (1970).  A non-compete agreement is reasonable when it 

(1) Protects the employer’s legitimate interests; 

(2) Imposes no undue hardship on the employee; and 

(3) Does not injure the public 

In all cases, “[t]he validity and enforceability of a covenant against competition  must be determined in light of the facts of the case.”  Graziano v. Grant, 326 N.J. Super. 328, 343 (App. Div. 1999).

However, it is questionable whether non-compete agreements will continue to be enforceable and viable in the State of New Jersey.  

What is Happening With Non-Compete Agreements?

In January 2023, the Federal Trade Commission (“FTC”) proposed a new rule that would essentially nullify the use of non-compete agreements in the workplace. Indeed, the proposal would make it an “unfair method of competition for an employer to enter into or attempt to enter into a non-compete clause with a worker; maintain with a worker a non-compete clause; or represent to a worker that the worker is subject to an enforceable non-compete clause.”   

Similarly, in New Jersey, there is pending legislation (Bill No. A3715/S1410) that would put significant restrictions on the use of non-compete agreements in the State of New Jersey.  Among the more significant restrictions are that the non-compete obligations would not be able to exceed twelve (12) months in duration; the agreement would not limit the separated employee from providing services for a customer if the customer initiated the solicitation; the non-compete obligations would have to be communicated to the employee in a formal offer letter or thirty (30) days after commencement of employment (whichever is earlier); and non-compete obligations would be unenforceable against certain types of employees (such as non-exempt employees under the Fair Labor Standards Act or seasonal or temporary employees).  

The Future of Non-Compete Agreements in New Jersey 

The future of non-compete agreements in the State of New Jersey is murky. If the FTC proposal is adopted, non-compete agreements may be void.  Regardless, if enacted the pending New Jersey legislation noted above would significantly limit the viability of non-compete agreements in the State.   

What Does This Mean For Your Business? 

In light of the above, businesses in the State of New Jersey should brace themselves for the possibility that non-compete agreements may be more difficult to enforce. As such, businesses should consult with employment counsel to track the FTC proposal as well as Bill No. A3715/S1410. In addition, businesses should engage employment counsel to review any existing non-compete agreements and update the same to comport with applicable law.      

CMS employment attorneys use their extensive experience to help clients navigate through complex issues pertaining to non-compete agreements. If you need assistance with the review, drafting, or updating of non-compete agreements, please contact Curcio Mirzaian Sirot LLC.