New Jersey has passed a bill that is considered one of the toughest wage theft laws in the country. Signed into law in August, the New Jersey Wage Theft Act (WTA) goes well beyond attempting to prevent and punish intentional wage theft; it includes expanded protections for employees and harsher employer penalties.
Wage theft is the unlawful practice of employers not paying their employees in full for the work they have performed. There are many ways it can perpetrated, including not paying for all hours worked, not paying minimum wage, withholding an employee’s last paycheck after they leave a job, or not paying a worker at all.
Wage theft is a national problem, and while no group of workers is immune, low wage workers are particularly vulnerable. Recently states have been strengthening their wage theft laws to underscore the importance for employers to inform workers of their rights and stay compliant with employment regulations. New Jersey’s legislation went into effect just days after Minnesota passed a new wage theft law, and New York recently joined several other states that allow employees to place wage liens on employers’ property.
Most provisions of New Jersey’s WTA went into effect immediately, amending a host of existing civil and criminal statutes. Here are some of the key takeaways that employees and employers need to be aware of:
· Violations of the wage theft measure include penalties that could result in:
Potential suspension or revocation of an employer’s business license.
A fine of $500 to $1,000 for first-time violations and $1,000 to $2,000 for second or further violations.
For the first time, employers found to have violated New Jersey’s wage laws are also subject to criminal penalties. Under the WTA, they must serve jail time of 10 to 100 days in addition to paying fines.
· The law significantly extends the statute of limitations for minimum wage and overtime claims from two years to six years, increasing the exposure for noncompliant employers.
· Employers are required to give current and newly hired employees a written statement of wage rights, which will be provided by the New Jersey Department of Labor and Workforce Development.
The WTA also expressly prohibits retaliation against employees who complain about their employers’ alleged violations of the New Jersey Wage Payment Law. Any employer that takes adverse action against an employee within 90 days of the individual’s filing a wage complaint will automatically face a presumption that the action was retaliatory.
Employee activity protected from retaliation under the WTA is not limited to filing formal complaints but includes employee complaints to employers or employee representatives and general discussions about wage rights with other employees.
An employer who is found to have retaliated against an employee for filing a complaint commits a disorderly persons offense and, if convicted, will be subject to fines ranging from $100 to $1,000, payment of the employee’s lost wages, and damages equal to 200% of the lost wages. If the employee was fired, the employer will be required to offer reinstatement unless prohibited by law.
While the WTA provides long overdue protections for employees, it creates challenges for employers and is likely result in increased litigation. At a minimum, New Jersey employers should ensure they are in compliance with all state wage and hour laws; provide each current and newly hired employee with notice of their rights under the State Wage and Hour Laws and how to file claims; and implement policies to correct any inadvertent wage and hour violations.
If you are an employer with questions about how the WTA will impact your business – or an employee who has been a victim of wage theft – call us at 973-509-8500 x213 or email LFarber@LFarberLaw.com.
The contents of this writing are intended for general information purposes only and should not be construed as legal advice or opinion in any specific facts or circumstances.