With a large population of well-educated and qualified young workers, New Jersey is as an attractive location for new businesses. In fact, the areas surrounding major state universities have some top labor markets in the country. If you are planning to start a business or expand to New Jersey, it’s vital for you to first have a clear understanding of New Jersey employment law and its potential impact. Put in a request through Priori's on-demand legal marketplace to connect with a vetted employment lawyer to review your concerns and ensure compliance with New Jersey's comprehensive employment laws.
Employee compensation is a major area of importance in New Jersey employment law. Like most states, New Jersey is subject to federal wage laws like the Fair Labor Standards Act (FLSA). While the FLSA does apply to employee compensation in New Jersey, New Jersey law generally sets stricter standards for wages and payment than those codified in the FLSA.
The New Jersey State Wage and Hour Law establishes the minimum wage and overtime wage in New Jersey. The current minimum wage is $8.38 per hour. This increases annually according to changes in the consumer price index. In addition, overtime rates at $12.57 per hour (or 1.5 times the current minimum wage) must be paid to all employees whose primary duties are not administrative, executive or professional on any hours worked beyond the standard 40 hours in a single week.
New Jersey State Wage Payment Law
The New Jersey Wage Payment Law ensures that workers are paid on a timely basis and that wage theft is prevented through oversight and automatic payments. In addition, the Wage Payment Law makes wage deductions for uniforms or other items required to perform basic job duties illegal. In general, companies cannot take money from employee paychecks for anything required for the job.
Hiring and Termination in New Jersey
Hiring and firing processes must be fair and in compliance with internal company policies as well as state and federal law. It is important for companies to write out these procedures in the employee handbook in order to avoid disputes or claims of discriminatory hiring practices or wrongful termination.
All jobs in New Jersey are assumed to be “at-will” employment. Both employers and employees can terminate the relationship at any time for almost any reason, as long as previously established procedures were followed and the reasons are not otherwise illegal. Employees let go generally are not due severance beyond the remaining paycheck and compensation for any unpaid vacation days, unless termination was due to widespread layoffs. In these cases, proper notice must also be given.
Every private company in New Jersey is expected to pay into unemployment insurance if they have even a single employee. After being dismissed for reasons other than cause, former employees can collect unemployment insurance benefits. In addition, federal law requires companies with at least 20 employees to be offered continued health insurance coverage for 18 months after dismissal under COBRA. In New Jersey, New Jersey Continuation extends this coverage to all employees of small businesses with fewer than 20 employees for 18 months.
New Jersey employment laws protect workers from injury or harassment in the workplace. All small businesses in New Jersey should carefully review worker protection laws in order to ensure compliance or risk serious sanctions.
New Jersey Workers’ Compensation Law
Any company with even a single employee in New Jersey not covered by Federal programs must carry workers’ compensation insurance. This can be acquired through any private insurer approved by the Division of Workers’ Compensation or waived by filing for self-certification with the Commissioner of the Department of Banking and Insurance.
After an employee has been injured on the job, they have the right to file a claim for compensation for treatment and 70% of their full wages during approved days off under New Jersey workers’ compensation laws. As an employer, you must not penalize employees for taking time of for recovery and treatments approved under a workers’ compensation claim.
Workplace Health and Safety
New Jersey is a "state-plan" state for workplace standards. This means state health and safety regulations are established under the New Jersey Public Employees Occupational Safety and Health (PEOSH) State Plan. While similar to OSHA, PEOSH differs subtly from federal regulations. It’s important to know state laws, not just OSHA guidelines as PEOSH is the ultimate health and safety law in New Jersey. Health and safety regulations applicable to your company will vary depending on your industry, area, and size, so be sure to check locally for compliance.
Anti-Harassment and Discrimination Laws
Workplace harassment and discrimination based on race, creed, religion, ethnicity, gender, sexuality, disability, martial status, military service, HIV status, or other protected classification is illegal in New Jersey. As an employer, you have a responsibility to encourage a workplace environment that allows for open reporting of discriminatory conduct and stop harassment when it is reported. If you fail to address harassment in the workplace, employees can file a complaint with the New Jersey Division on Civil Rights or the federal Equal Employment Opportunity Commission if your company employs more than 15 people.
Family and Medical Leave Act
New Jersey law does not mandate any paid leave for employees, but the Family and Medical Leave Act requires all employers with at least 50 employees to provide employees with job-protected unpaid leave for qualified medical and family reasons. These reasons include personal or family illness, domestic violence incidents, family military leave, pregnancy, adoption, or the foster care placement of a child. Many companies in New Jersey do provide some paid leave for salaried employees or additional paid sick days, but this is not required.
Can I require my employees to sign a noncompete agreement in New Jersey?
Yes, you can require new employees to sign a noncompete as a condition of employment. It’s important to remember, though, that any noncompete will have limited reach. If you want to ensure that your noncompete can be enforced, it may help to speak with an attorney before drafting language.
What are whistleblower laws like in New Jersey?
New Jersey whistleblower laws should protect employees from losing their job in retaliation for reporting an illegal activity. If an employee reports violations of environment laws, corruption laws, labor laws, or other related regulations, you cannot fire them in retaliation for such reports. Whistleblowing is considered a carefully protected employee right in New Jersey.
Where do they have strictest employment laws in New Jersey?
Generally speaking, employment laws are the same across the state. If you choose to operate in Hoboken, Newark, Princeton, or Trenton—or anywhere else— the laws that will apply to your business are likely to be equally strict. While there may be minimal differences from county to county, the labor laws change very little across New Jersey.