Unlike the Bon Jovi song “Never Say Goodbye,” everyone is eager to bid farewell to 2020.
No one is more ready than those running a business. In addition to business disruptions, safety protocols, and PPP loans, employers in the Garden State had to navigate a slew of new labor laws that were enacted this year. Here, we explore a few.
The practice of misclassifying workers as independent contractors or “1099s” had been a growing concern in New Jersey for some time. A task force was created in 2018 to assess the extent of the problem. According to their findings, misclassification increased by 40% in the past ten years.
Like rolling a seven at the craps table at the Borgata, luck finally ran out for these offenders. On January 21st Governor Murphy signed laws designed to protect workers and penalize employers in the amount of $250 for a first violation, and up to $1,000 per misclassified employee. The laws give the Department of Labor authority to investigate violations, subpoena payroll and tax records, interview employees, and issue stop-orders.
A poster was released in May that employers must display that explains how employees can file a possible misclassification charge. This poster, along with a simple test you can use to determine the right category for your workers, can be found in our guide: Protecting Your Organization from Worker Misclassification.
In March 2019, New Jersey became the first state to require employers to offer a commuter benefit program to their employees. The law was inoperative, meaning it wasn’t enforced, until March 1, 2020.
It requires New Jersey employers with 20 or more employees to offer transportation benefits, a tax-free fringe benefit that allows workers to pay for certain commuting costs using pre-tax money. These benefits cover transit, parking, and ridesharing costs. (Think meters, NJ Transit, Uber, and Lyft.)
Penalties for non-compliance are hefty, so don’t let this program derail your efforts. BPHR’s Director Lisa Salcido recommends contacting a benefits broker or third-party provider to set up a compliant program and updating your employee handbook’s policies to fulfill the notification requirement. Read more here.
Amendments to the WARN Act
Back on January 21st, before COVID, Governor Murphy signed into law amendments to the Worker Adjustment and Retraining Notification (WARN) Act, an act that requires employers to provide severance to employees affected by a mass layoff. These amendments were set to go into effect in July, obligating employers to payout one weeks’ salary to employees for each year of employment.
Fast forward a few months, the pandemic erupted and there were massive labor disruption and layoffs. As a result, the WARN Act was amended again on April 14th to exclude natural disasters or national emergencies, such as the COVID-19 pandemic, from the definition of mass layoff. These exclusions were effective immediately and retroactive to March 9, 2020.
What about the amendments that were set to take effect in July? Those are postponed to 90 days after the emergency declaration in New Jersey is lifted. It’s feeling a lot like Groundhog Day; as of publication, Governor Murphy extended the state of emergency for the ninth time. Staten Island Chuck, just over the Goethals, agrees.
Families First Coronavirus Response Act (FFCRA)
While the leave provisions established under the FFCRA are expected to expire when the ball drops in a deserted Times Square, they are worth mentioning here because lawsuits stemming from violations of the law are likely to linger long into 2021.
The FFCRA was signed into law on March 18th, temporarily providing the American workforce with emergency paid sick leave and emergency paid FMLA leave for COVID-related absences. The Act took effect on April 1st, expanding benefits to employers with fewer than 500 employees.
It wasn’t long before the DOL began exercising its enforcement authority. In many cases, the employers were not aware they were violating the law. To avoid a similar fate, employers are encouraged to familiarize themselves with the law. Read what you need to know here.
New Jersey Strong
Despite challenges, New Jersey business owners displayed strength and tenacity this year. Whatever 2021 brings, New Jersey employers will persevere, because we know they are, in the words of Bruce Springsteen, “Tougher Than the Rest.”
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