Bruce Springsteen might like being “The Boss,” but that’s not the case for many employers in New Jersey right now. The passing of many complex labor laws in 2019 is making it a challenge to run a business.
These new laws come at a time when many are just grasping the impact of the aggressive laws of 2018.
For some that meant facing an audit. In the last few months of 2019, Balance Point observed an uptick in the number of clients receiving audit notices from the New Jersey Wage and Hour Division, likely a result of the state’s 2018 enactment of the Earned Sick Leave Law.
The best way to remain compliant is to keep informed and up to date on all laws and HR best practices. We are committed to being a resource to you, so here we present some of the laws that should be on your radar.
Minimum Wage Increase
New Jerseyans had to wait 16 years for The American Dream mall (a.k.a. Xanadu) to finally open, but will only have to wait six years for the minimum wage to reach $15. On February 4th, Governor Murphy signed a new minimum wage bill that will raise the current rate of $8.85 to $15 by 2024.
This new law raises the minimum wage in increments: the wage increased to $10 per hour on July 1, 2019 and will rise to $11 on January 1, 2020. Thereafter, the minimum wage will increase $1 every year until reaching $15 per hour in 2024.
The minimum wage will increase at a slower rate for small businesses with less than six employees, seasonal businesses, and farm labor. Also included in the bill is an increase in tipped workers’ minimum wage rates and a training wage.
Family Leave Programs
We’ve been fielding questions about the state’s leave entitlements ever since Governor Murphy signed a bill on February 19th that provides longer leave and greater benefits for New Jersey workers.
Multiple programs have been affected including the Family Leave Act (FLA), Family Leave Insurance (FLI) and Temporary Disability Insurance (TDI), and the Security and Financial Empowerment Act (SAFE). You can read more about them on our blog.
Although these paid benefits are not funded directly by employers, expanded eligibility to receive benefits and doubling the duration of leave will have unintended consequences. Operating costs will increase through additional overtime wages to pay for coverage and small organizations are affected by the need to hire replacement staff to cover workers out on job-protected leave.
Medical Cannabis Act (CUMCA)
Governor Murphy had high hopes that recreational marijuana would be legalized by the end of the year, however lawmakers snuffed out the bill twice this year. But he was able to add new job protections and drug testing procedures for users of medical cannabis. On July 2nd he signed the legislation and renamed the program the Jake Honig Compassionate Use Medical Cannabis Act (CUMCA).
Employers are encouraged to review their drug testing procedures and “drug and alcohol” policies to ensure compliance with the law. The CUMCA does not prohibit drug testing, but it creates new procedures that must be followed when an employee or applicant has tested positive for marijuana.
We outline these procedures and address “adverse employment actions” in a Q&A posted to our blog.
Wage Theft Act
On August 6th, New Jersey enacted one of the nation’s strongest wage theft laws. The law boosts penalties for employers that illegally withhold pay from workers. Not only could they be forced to pay up to six years of miscalculated wages, or up to 200% of miscalculated wages, habitual offenders could be fined up to $15,000.
What’s most worrisome is the threat of imprisonment. Repeat “criminals” could face up to five years of jail time—that’s seven times longer than Jersey Shore’s Mike Sorrentino (a.k.a. “The Situation”) served this year for tax evasion!
While the law seeks to penalize employers who knowingly cheat workers and deprive the government of income, even those who act in good faith but make unintended mistakes are still at risk.
Start the Year Off Right
These laws are just some of the many making waves along the Jersey Shore and across the state. Stay informed on all you need to know by subscribing to our updates.