Christie Vetoes Expansion of New Jersey Family Leave & Increased Minimum Wage

On July 21, 2017, New Jersey Governor Chris Christie conditionally vetoed two bills that would have expanded New Jersey’s pioneering paid Family Leave Act and raised minimum wage for certain transportation center service workers.  Under the New Jersey Family Leave Act (NJFLA), which applies to New Jersey companies with 50 or more employees, workers are eligible to receive up to 12 weeks of continuous leave during a given 24-month period to care for a newly born or adopted child, parent, a child under 18, spouse, or civil union partner who has a serious health condition requiring in-patient care, continuing medical treatment or medical supervision.  The leave is partially paid, and eligible employees can generally receive up to $633 per week.

The Bill (A4927) would have extended the NJFLA’s coverage to employers with 20 or more employees and expanded the definition of “family member” to include siblings, grandparents, grandchildren and parents-in-law.  Moreover, the Bill would have doubled the maximum number of weeks of family temporary disability leave benefits from 6 weeks to 12 weeks, increased available intermittent leave from 42 days to 84 days, and raised the weekly cap on paid benefits to $932, depending on the claimant’s income.

Governor Christie denounced the Bill’s supporters as disregarding the increased cost to taxpayers and the potentially adverse impact the bill would have on small businesses in New Jersey.

The minimum wage bill (A4870) would have significantly raised New Jersey’s minimum wage for employees at Newark Liberty International Airport, Newark Penn Station, and the Hoboken Terminal, from $10.10 to $17.98 per hour.  Incidentally, Christie vetoed a bill last year that would have raised New Jersey’s minimum wage from its current $8.44 to $15.00 per hour.  The New Jersey Business & Industry Association, considering the vetoes to be a victory to New Jersey employers, stated that the minimum wage bill would have set “a terrible precedent by circumventing the collective bargaining process and imposing backdoor wage and benefit increases by statute.”

For more information on these vetoes and current laws regarding family leave, minimum wage, or other applicable leave laws, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullnullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullnullgenovaburns.com, or 973-533-0777.

$15 Minimum Wage Bill Heads to Governor Christie’s Desk

In a close 21-18 vote the New Jersey State Senate passed bill S15, the $15 Minimum Wage Bill. The bill will now head to Governor Christie’s desk after its previous stamp of approval from the New Jersey State Assembly.  The vote proceeded along party lines with the 18 Republican legislators raising objections to the increased costs on businesses and the 21 Democratic legislators fighting to provide a living wage.

Governor Christie has not commented on whether he will veto the bill but it is highly unlikely he accepts the $15 wage increase. State Democratic leaders have promised to submit the $15 minimum wage to the voters in a constitutional referendum if Governor Christie vetoes the bill.

$15 minimum wage bills have already been signed into law in New York and California.  Massachusetts, Vermont and Connecticut are currently considering similar bills. In addition to the $15 minimum wage there are potential costs for insurance and payroll taxes.  Employers should continue to stay informed on the movement of this legislation with an eye on implementation in early 2018.

For more information regarding the potential impacts of Bill S15, or regarding any other wage and hour issues, please contact John R. Vreeland, Esq. Director of the Firm’s Wage & Hour Compliance Practice Group, at 973-535-7118 or jvreeland@nullgenovaburns.com, or Aaron C. Carter, Esq. at 973-646-3275 or acarter@nullgenovaburns.com.

New Jersey Assembly Picks Up Fight For $15 Minimum Wage

The fight for a $15 minimum wage is gaining steam in the New Jersey Legislature. On May 26, 2016, the New Jersey Assembly passed Bill A15, which would raise the minimum wage to $15 an hour by 2021. Currently, the New Jersey State minimum wage is $8.38 per hour.

The $15 minimum wage would not get there all at once. Under the recently passed bill, the minimum wage first would increase to $10.10 per hour on January 1, 2017.  Then, between 2018 and 2021, the minimum wage would increase by the greater of $1.25 an hour or $1.00 an hour plus the CPI each year. An identical version of the Assembly’s bill has already passed the New Jersey Senate’s Labor Committee (Bill S15). If the full Senate passes the bill it will head to the Governor’s desk where it most likely will be vetoed.

But the Governor’s veto may not be the end of the bill. The Legislature is proposing that in the event of a Governor veto, the bill be put to a constitutional referendum for the voters to decide during the New Jersey General Election on November 7, 2017. This would not be the first time the Legislature managed to get around a veto to increase the minimum wage. The minimum wage was previously raised by constitutional referendum in 2013 when voters amended the State’s Constitution to increase the minimum wage to $8.25 per hour despite a Governor Christie veto.

While the proposed $15 minimum wage may seem a long way away, employers should start thinking now about how this would affect their business. Many employers are still struggling from the more than 15% increase in the minimum wage over the last two years. An increase to just $10.10 in 2018 (which is when the increase would take effect if the bill is vetoed but then approved through referendum) would reflect another 20% increase, or an almost 40% increase since 2013.  Such increased labor costs may be more than some employers can or are willing to absorb. For instance, Wendy’s recently stated it would replace some workers with automated machines in response to significant increases in minimum wage.

For more information regarding the potential impacts of Bill A15, or regarding any other wage and hour issues, please contact John R. Vreeland, Esq. Director of the Firm’s Wage & Hour Compliance Practice Group, at 973-535-7118 or jvreeland@nullgenovaburns.com, or Aaron C. Carter, Esq. at 973-646-3275 or acarter@nullgenovaburns.com.

New Wage and Hour Poster for 2015 Increase to New Jersey’s Minimum Wage

The New Jersey Department of Labor has issued a new Wage and Hour Law poster.  The new poster includes updates reflecting the imminent increase to New Jersey’s minimum wage to $8.38, effective January 1, 2015.  Employers are required to post notice of the minimum wage rate in a conspicuous place in which employees have access, such as the cafeteria or break room.  Employers may display this poster prior to January 1, 2015, but must also continue to post the mandated 2014 poster through December 31, 2014.

This serves as a reminder to all employers that the minimum wage increase will automatically take effect as of January 1, 2015.  Employers should be mindful of this increase and update their wage payment policies and payroll systems accordingly to reflect the applicable minimum wage rates and ensure that all employees are properly paid.

A copy of the minimum wage rate poster can be found on the New Jersey Department of Labor and Workforce Development’s website, or through this link: http://lwd.state.nj.us/labor/forms_pdfs/lsse/mw-220.pdf.

If you have any questions or for more information about the requirements of the updated minimum wage rate and its impact on your business’s payroll policies, please contact John R. Vreeland, Esq. Director of Wage & Hour Compliance, at 973-535-7118, jvreeland@nullgenovaburns.com or Allison Gotfried, Esq., at 973-646-3297, agotfried@nullgenovaburns.com.

Governor Christie Vetoes NJ Minimum Wage Increase, Makes Counterproposal

As anticipated, Governor Chris Christie conditionally vetoed legislation yesterday that would have increased New Jersey’s minimum wage from $7.25 to $8.50 on March 1, and tied future increases to the Consumer Price Index. As we have written here, it is likely Democrats will now push forward with efforts to put the minimum wage question on the ballot for voters to decide in November.

While Governor Christie found the bill untenable in its current form because he believes it will jeopardize economic recovery, he did not reject a minimum wage increase outright. Instead, Governor Christie now proposes a smaller rate increase to be phased in over three years, with no link to CPI. Christie suggested an immediate $0.25 per hour increase, followed by $0.50 in 2014 and another $0.25 increase in 2015. Even these slight increases would propel New Jersey ahead of 22 other states whose minimum wage is $7.25, the same as the federal minimum.

We will continue to monitor New Jersey’s minimum wage debate and the impact on our business community. For more information on the potential increase to minimum wage in New Jersey and our firm’s wage and hour compliance audit services, please contact John R. Vreeland, Esq., Director of the firm’s Wage & Hour Compliance Practice Group, jvreeland@nullgenovaburns.com, or Douglas J. Klein, Esq., dklein@nullgenovaburns.com.

New Jersey and New York Trailing Other States In Increasing Minimum Wage

As we have written here and here, New Jersey recently passed legislation to increase the state’s minimum wage to $8.50. Governor Christie has not announced whether he will veto the bill, and there is still the possibility of voters deciding the issue when they cast ballots in November. In New York, Governor Cuomo recently voiced his support for raising New York’s minimum wage from $7.25 to $8.50.

New Jersey and New York, historically progressive when it comes to implementing legislation protecting workers’ rights, actually trail other states that have already taken action to increase minimum wage. Ten states – Arizona, Colorado, Florida, Missouri, Montana, Ohio, Oregon, Rhode Island, Vermont and Washington – increased their minimum wage this month. Nine of these states also adopted an indexing model, which ties future increases in minimum wage to increases in the Consumer Price Index (“CPI”). New Jersey’s pending minimum wage legislation has the same tie in to the CPI, though, as many opponents of the legislation have pointed out, it does not provide for decreases in minimum wage if CPI falls.

The increases already enacted across the country affect nearly 1,000,000 workers who will now earn between $200 and $500 more annually. For employees, the increases are well welcomed, especially as the Social Security payroll tax holiday ended on December 31, 2012. For employers, these increases mean potential landmines. Increases in the minimum wage may reduce leverage at the bargaining table for unionized employers where unions will be less inclined to make concessions in other terms and conditions of employment to secure higher wages. Increases in the minimum wage may also reduce or eliminate a company’s profits under a multi-year service contract where the company’s bid was based on wages that are now below minimum wage. And, of course, DOL compliance audits will likely catch employers who are unaware that the wages they pay are now below the minimum wage, resulting in costly wage assessments and penalties.         

We will continue to monitor legislation affecting minimum wage and the impact on our business community. For more information on the potential increase to minimum wage in New Jersey and New York and our firm’s wage and hour compliance audit services, please contact John R. Vreeland, Esq., Director of the firm’s Wage & Hour Compliance Practice Group, jvreeland@nullgenovaburns.com, or Douglas J. Klein, Esq., dklein@nullgenovaburns.com.

State Legislature Scrambles to Enact Pro-Employee Wage and Hour Legislation as 2012 Draws to a Close

With year-end fast approaching, we continue to monitor proposed wage and hour legislation which stands to place additional burdens on NJ employers. 

NJ Minimum Wage To Increase?

Today, the NJ Senate passed a bill increasing New Jersey’s minimum wage from $7.25 to $8.50 per hour beginning in 2013.  Under the bill, future increases would be tied to increases in the Consumer Price Index.  If implemented, NJ would become the eleventh state in the U.S. to tie minimum wage increases directly to the Consumer Price Index.  The bill, which already passed in the Assembly, will soon head to Governor Christie’s desk for his signature.  The Governor has expressed opposition to an increase to NJ’s minimum wage, and it is very possible he will veto the legislation. 

Anticipating a veto, Senate and Assembly leaders have discussed the possibility of placing the minimum wage increase question on the ballot next November to let voters decide.  There are, of course, serious risks with this approach, for example the risk of having the issue decided by uninformed voters who are unaware of the economic risks and risks to the business community associated with a hike.

In light of potential imminent action impacting minimum wage in the state, all NJ employers should assess how a raise in minimum wage will impact operations.  Employers are well advised to work with counsel to evaluate current pay practices to ensure compliance with federal and NJ minimum wage and overtime requirements.  Counsel may also assist employers in determining whether any exceptions to minimum wage requirements are available.

Legislature Cracking Down on Pay Practices for New Jersey Trucking Employees

In an effort to combat financial incentives for employers who misclassify truck drivers as independent contractors, the NJ Legislature is also advancing a bill which would impose criminal penalties on employers who purposefully misclassify drivers as independent contractors and not employees. The bill would create a presumption that most work arrangements for truck drivers are employer-employee relationships.  Employers will bear the difficult burden of convincing the NJDOL that they do not maintain enough control over the truck driver’s services to justify employer status.

Under federal and NJ law, employers generally are required to pay non-exempt employees at least minimum wage for all hours up to 40 in a workweek, and one and one-half times the employee’s regular rate of pay for each hour over 40.  There are certain exemptions from overtime laws both at the federal level and in NJ.  For example, federal law does not obligate certain trucking industry employers to pay overtime.  However, under NJ law, trucking industry employers must pay drivers, helpers, loaders and mechanics an overtime rate of at least one and one-half times minimum wage (currently $7.25 in NJ) for each hour of work over 40 in a workweek.  NJ law defines a “trucking industry employer” as “any business or establishment primarily operating for the purpose of conveying property from one place to another by road or highway, and includes the storage and warehousing of goods and property.” 

The proposed bill follows a recent NJ Appellate Division decision finding that retailers are not entitled to NJ’s trucking employee exemption.  In deciding so, the court distinguished between entities whose primary business is delivery, moving or storage, and entities for which delivery is an incidental function, such as a furniture retailer that provides home delivery service.

In advance of the bill passing and to avoid costly NJDOL wage and hour investigations and lawsuits, NJ employers using truck driver services should assess pay practices and work with counsel to determine the applicability of the “trucking industry employer” exemption and whether they appropriately designate workers as independent contractors.

For more information on the potential increase to NJ minimum wage, appropriately classifying independent contractors and our firm’s wage and hour compliance audit services, please contact John R. Vreeland, Esq., Director of the firm’s Wage & Hour Compliance Practice Group, jvreeland@nullgenovaburns.com, or Douglas J. Klein, Esq., dklein@nullgenovaburns.com, or call (973) 533-0777.