By Francine Foner, Esq., Ty Hyderally, Esq.
On August 6, 2019, Acting Governor Sheila Oliver signed into law S1790 (the “Act”), which significantly strengthens protections for employees who are not paid their proper wages. The new law amends New Jersey’s existing wage laws to enhance enforcement procedures and provide increased civil and criminal penalties for employers who violate the wage laws, and also greatly expands the time period during which an employee can recover unpaid wages.
Senator Loretta Weinberg, one of the primary sponsors of the bill, aptly observed, “Wage theft is immoral, intolerable and yet, far too common. More often than not, it is those at the lowest rungs of our socioeconomic ladder that are taken advantage of by their employer. It falls on us, therefore, to defend those who don’t generally have the means to defend themselves. In July, we took our first step to a $15 minimum wage but if we didn’t take care to ensure New Jersey employees receive their rightful wage, we would fail many of those we are trying to lift up. Giving employees greater power and protections is an important step in the path towards everyone earning a living wage.” (Governor’s Office Press Release, https://nj.gov/governor/news/news /562019/approved/20190806a.shtml).
One of the more notable impacts of the new law is that, in addition to repaying the employee the wages owed, employers will have to pay liquidated damages of 200% of the amount of wages owed. However, for a first violation, if an employer shows that the violation was an inadvertent error made in good faith and based upon reasonable grounds for believing there was no violation of the law, and also admits the violation and pays the amount owed within 30 days, the employer will not be required to pay any liquidated damages.
Another significant gain for employees is the expansion of the time period during which an employee can recover unpaid wages from 2 years (or 3 years for willful conduct) prior to the filing of the claim, to up to six years prior to the filing of the claim. This change is consistent with the recent similar expansion of the lookback period to six years for unequal pay claims under the New Jersey Law Against Discrimination.
The Act also requires employers to offer reinstatement to employees who were discharged in retaliation for: complaining to an employer about unpaid wages; filing or informing the employer that they have filed or are going to file a claim for wages due; informing other employee(s) about rights under State laws regarding wages and hours worked; testifying in a proceeding related to the Act; or having served or are about to serve on a wage board. In addition, an employer must take other actions as needed to correct the retaliatory action. Further, if an employer terminates an employee within 90 days of that employee filing a complaint on behalf of him- or herself or another employee, the timing of the termination is considered presumptive evidence that it was knowingly taken in retaliation against the employee.
In addition, employees may recover their costs and reasonable attorney’s fees incurred in bringing any action to recover wages due, or any wages lost because of an employer’s retaliatory actions.
The new law also substantially increases criminal penalties for employer violations of the wage laws as follows: for a first violation an employer shall pay a fine in the amount of $500-$1,000 and/or face imprisonment for 10-90 days, and shall be guilty of a disorderly persons offense; for a second violation the employer shall pay a fine in the amount of $1,000-$2,000 and/or face imprisonment of 10-100 days, and shall be guilty of a disorderly persons offense; and upon a third or subsequent violation, the employer shall pay a fine in the amount of $2,000-$10,000 and/or face imprisonment for up to 18 months, and shall be guilty of a crime of the fourth degree. Each week in any day of which a violation occurs is a separate and distinct offense.
The Act also establishes the crime of “pattern of wage nonpayment.” An employer may be found guilty of the crime of pattern of wage nonpayment for knowingly violating N.J.S.2C:40A-2 (violation of contract to pay employees) or N.J.S.2C:20-2 (theft and computer criminal activity offenses), if the property stolen consists of compensation due under New Jersey wage laws and the employer is convicted on two or more occasions of violating New Jersey wage laws. A crime of pattern of wage nonpayment is a crime of the third degree, and if convicted, an employer may be required to pay additional fines and restitution to victims.
The law provides that it shall take effect immediately, except that the section regarding the crime of pattern of wage nonpayment will take effect November 1, 2019.
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