New NJ Wage Theft Law Imposes Steep Fines On Employers Who Fail To Pay Wages
Published by Eric A. Welter and Megan M. Carboni on September 13, 2019
New Jersey employers are now on the hook for fines, penalties, and liquidated damages equal to 200% of wages owed to employees.
On August 6, 2019, Acting Governor Sheila Oliver signed New Jersey Senate Bill No. 1790 (“S1790”) into law, which expands the fines, penalties, and damages to be imposed against employers who fail to timely pay wages owed to employees under the state’s wage payment law. The new “wage theft” law takes effect immediately.
Key provisions of S1790 include:
- Liquidated damages equal to 200% of the wages owed. Liquidated damages are not required for a first time violation if a New Jersey employer can show (to the satisfaction of a court) that (1) the failure to pay all wages owed was an inadvertent error made in good faith, (2) that the employer had reasonable grounds for believing the error was not in violation of the law, and (3) the employer acknowledges the violation of the law and pays wages owed within 30 days’ notice of the violation.
- Fines of $500 plus 20% of wages owed for first the first offense, and fines of $1,000 plus 20% of wages owed for each subsequent offense.
- Administrative penalties may be assessed up to $250 for the first offense, and up to $500 for each subsequent offense.
- Criminal penalties may be assessed against corporate officers or employees responsible for violations of wage payment laws (including retaliation against employees who file complaints under S1790), including conviction of “disorderly persons offense,” fines up to $1,000 or jail time up to 90 days for a first offense, and fines up to $2,000 or jail time up to 100 days for subsequent offenses.
- Employers are also subject to a wage payment audits in lieu of or in addition to the above mentioned damages, fines, and penalties. If an audit reveals additional violations of wage payment laws, the employer and responsible corporate employees may be subject to additional fines, penalties, and/or jail time.
- Retaliation is presumed where an adverse action occurs less than 90 days after an employee files a complaint to recover unpaid wages. Where an employer is found to have retaliated against an employee, the employer will be liable for all wages lost as a result of the retaliation plus liquidated damages equal to 200% of wages lost due to retaliation.
- Employees now have 6 years to file claims of unpaid wages, minimum wage, or overtime violations.
In addition to the above-mentioned damages, fines, and penalties, New Jersey employers will also face a presumption of liability under S1790 if the company fails to maintain proper wage payment records. Further, any successor company should be aware that they could be on the hook for a predecessor’s liability under S1790.
New Jersey employers should get ready for a bumpy ride if they are knowingly failing to pay proper wages under state wage laws or if they have not been keeping proper records. All New Jersey employers should immediately ensure that payroll and accounting processes are in place for proper payment of wages. Additionally, New Jersey employers should immediate seek counsel if a complaint regarding the payment of wages is filed, or risk steep damages, penalties, fines, and/or jail time.Topics: Employment Litigation, New Jersey, Wage and Hour, Wage and Hour Compliance and Litigation, Wage Theft