On August 6, 2019, the Lieutenant Governor of New Jersey, Sheila Oliver, signed legislation to combat wage theft. The Wage Theft Act (WTA) amends the New Jersey Wage Payment Law, the New Jersey Wage and Hour Law, and the New Jersey Wage Collection Law. The law covers all employers in New Jersey, and most of the WTA provisions were effective immediately upon signing. The enacted Wage Theft Law is considered by many to be one of the strongest in the country since it considerably increased the damages, remedies, and liabilities for employers in the Garden State. Here are some of the key changes.
Limitations Period and Consequences for Not Maintaining Proper Records
Under the WTA, the statute of limitations for unpaid minimum wages and overtime claims was increased from two years to six years. This means that employees can recover up to six years of unpaid wages. Employers must maintain sufficient records, and if they fail to do so, the assumption is that the employee’s claim is valid. It is important to note that this also applies to claims alleging retaliation under the Wage Theft Act.
Attorney’ Fees and Liquidated Damages
Before the WTA, liquidated damages were not available under New Jersey law regarding wage and hour claims. Now, employers that fail to pay wages to an employee and are found liable must pay the full amount of wages owed and liquidated damages equal to 200 percent of the wages due, including costs and attorneys’ fees.
The WTA strengthens anti-retaliation provisions. Any adverse action against an employee within 90 days of an employee initiative in court or filing a complaint with the Commissioner of Labor in the Wage Collection Section, will now be considered retaliation. The amendments also implement a more expansive definition of retaliation, and now protect employees that speak out against wage theft. The previous statute did not directly address employees that informed others about their rights.
When an employer is found to have violated the WTA, they will be imposed a fine of $500 to $1,000 and a penalty of 20% plus wages owed for a first offense. Employers can also face 10 to 90 days of jail time for such offenses. Second-time offenses and any other subsequent offenses will result in a fine of $1,000 to $2,000 per offense, possible imprisonment up to 100 days, as well as a 20% penalty on wages owed to the employee.
Joint and Successor Liabilities
Apart from corporate and individual liability, the WTA also imposes liability for joint or successor employers. Under the statute, “labor contractors” and “client employers” are subject to joint and several liability for any violations of state wage and hour laws, as well as certain criminal violations.
Pattern of Wage Nonpayment
A “Pattern of Wage Nonpayment” is a third-degree crime punishable by three to five years imprisonment or a fine of $15,000, or both. If a person is found to have knowingly committed a wage nonpayment crime, they will be convicted
These are some of the most notable changes that the WTA has enacted. If you want to find out more about how the WTA affected employers and employees, contact a professional at Cilenti & Cooper, PLLC at (718) 841-7474