Articles Posted in New Jersey Labor Law

New Jersey MapIn New Jersey, employment laws at the federal and state levels protect a variety of employee rights. When federal and state laws conflict with each other, the preemption doctrine holds that federal law usually supersedes state or local laws. The New Jersey Supreme Court ruled last year on an appeal of of a ruling that a New Jersey whistleblower claim was preempted by federal law. The court reversed the lower court rulings, finding that the plaintiff’s claims were not preempted. Puglia v. Elk Pipeline, Inc., 141 A.3d 1187 (N.J. 2016).

The New Jersey Conscientious Employee Protection Act (CEPA) prohibits retaliation against employees who report suspected violations of law by their employers. N.J. Rev. Stat. § 34:19-3. The plaintiff in Puglia had complained of alleged violations of New Jersey’s Prevailing Wage Act (PWA), which governs wages paid by companies involved in public works contracts and which allows employees to protest alleged violations. Id. at § 34:11-56.34.

The federal National Labor Relations Act (NLRA) and Labor Management Relations Act (LMRA) govern collective bargaining agreements (CBAs) between management and labor unions. Section 301 of the LMRA gives federal courts jurisdiction over disputes between employers and labor organizations. 29 U.S.C. § 185(a). The U.S. Supreme Court has “given broad substantive effect” to this provision. Puglia, 141 A.3d at 1192. It therefore preempts almost any case that involves “what the parties to a labor agreement agreed.” Id. at 1193, quoting Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 211 (1985).

firemanNumerous New Jersey employment laws at both the state and federal levels prohibit employers from retaliating against employees, including in the forms of termination, suspension, demotion, and other adverse actions, for engaging in various legally protected activities. Proving that a particular adverse action was motivated by an employee’s protected activities can be difficult and often requires documentation of contacts between an employee and the employer’s management. Unlawful retaliation often occurs in connection with other unlawful acts by an employer, such as discrimination or harassment. It can also occur, however, in connection with lawful acts by an employee, of the sort that we want to encourage as a matter of public policy. Several years ago, New Jersey enacted a law aimed at protecting workers who volunteer to serve their communities in times of emergency. The New Jersey Emergency Responders Employment Protection Act (NJEREPA), which took effect in 2010, protects workers from adverse employment actions for missing work due to volunteer emergency service.

Retaliation claims frequently arise along with claims under the New Jersey Law Against Discrimination or Title VII of the Civil Rights Act of 1964, such as when an employer terminates an employee for reporting unlawful discrimination. The purpose of these laws’ anti-retaliation provisions is to encourage workers to come forward with reports of sexual harassment and other discriminatory acts. The National Labor Relations Act prohibits retaliation by employers against workers engaged in labor organizing and related activities, with the goal of helping workers assert their rights through collective bargaining. The Family and Medical Leave Act protects workers’ right to legally authorized leave by prohibiting retaliation for taking leave.

The NJEREPA applies to “volunteer emergency responders,” defined as individuals actively involved in emergency responses with a volunteer fire department, a “first aid, rescue or ambulance squad,” or a local emergency management department. N.J. Rev. Stat. § 40A-14-214(a). The statute prohibits employers from retaliating against an employee who misses work because of service as a volunteer emergency responder, provided that the employee meets two criteria:  (1) the employee notifies the employer at least one hour before a scheduled work shift, and (2) the employee provides the employer with “a copy of the incident report and a certification by the incident commander” when they return to work. Id. at § 40A-14-214(b). The employer is not required to pay the employee for time missed from work.

New Meadowlands StadiumNew Jersey employment statutes and other laws around the country prohibit employers from taking certain adverse actions against employees. Antitrust laws can provide relief for workers when a direct employer-employee relationship might not exist. Laws like the Sherman Act prohibit companies that ostensibly compete with one another from making agreements that impede competition. This is often known as “collusion.” Agreements among companies not to hire one another’s workers, for example, hurt workers by limiting their job opportunities. Colin Kaepernick, a professional football player who has been a controversial public figure in the past year or so, is making similar allegations in a grievance filed against the National Football League (NFL). He is a free agent, but no team has signed him since the controversy gained prominence. Rather than a lawsuit under a law like the Sherman Act, the player is alleging violations of the collective bargaining agreement (CBA) between the players’ union and the NFL. The case could have a national impact, since NFL teams are located all over the country, including two that play in New Jersey.

The Sherman Act prohibits businesses from making “contract[s]…or conspirac[ies] in restraint of trade or commerce among the several States.” 15 U.S.C. § 1. Agreements among market competitors that deliberately restrict or restrain trade, such as price-fixing, clearly violate the Sherman Act. In situations in which the alleged restraint is less obvious, courts use the “Rule of Reason” to determine whether the restriction is anti-competitive or not. Addyston Pipe & Steel Co. v. United States, 175 U.S. 211 (1899).

Agreements among NFL teams could constitute unlawful collusion under a recent U.S. Supreme Court decision. The court held that the creation of a single business entity to handle product licensing for all 32 NFL teams “constitute[d] concerted action that is not categorically beyond the coverage of §1.” American Needle, Inc. v. National Football League, 560 U.S. 183 (2010). It held that courts should apply the Rule of Reason to determine whether such agreements violate antitrust law. While that case dealt with intellectual property, it established that NFL teams are distinct entities that might have distinct economic interests.

cannabisIn 2009, the New Jersey Legislature authorized the possession and use of small amounts of marijuana for medical purposes with a doctor’s prescription. Federal law, however, still classifies marijuana as a controlled substance with no recognized medical use. This has led to considerable uncertainty in the area of employment law, such as whether states that allow medical marijuana use also protect workers against discrimination based on drug use that, while legal under state law, still violates federal law. So far, no New Jersey court has found that state antidiscrimination law covers lawful medical marijuana use, but at least one such claim is currently pending in state court. The defendant in that lawsuit is arguing that the federal Controlled Substances Act (CSA) preempts any state laws addressing employment discrimination claims. A federal court in Connecticut recently rejected a similar argument in Noffsinger v. SSC Niantic Operation Company, No. 3:16-cv-01938, ruling (D. Conn., Aug. 8, 2017). While this ruling does not directly affect New Jersey courts, it could have an impact on future cases.

The New Jersey Compassionate Use Medical Marijuana Act (NJCUMMA), N.J. Rev. Stat. § 24:6I-1 et seq., establishes procedures for medical professionals to prescribe marijuana. It also exempts qualifying medical professionals and their patients from liability under the state’s criminal and civil laws dealing with marijuana. Id. at §§ 2C:35-18, 24:6I-6. It does not specifically mention employment. A pair of bills introduced in the New Jersey Legislature, A2482 and S2161, would add specific employment protections for medical marijuana patients, but they have never received hearings.

Under the Supremacy Clause of the U.S. Constitution, federal law generally takes precedence over conflicting state laws. The CSA’s classification of marijuana as a Schedule I controlled substance, 21 U.S.C. § 812(c)(I)(c)(10), has caused much confusion in this regard. Preemption by federal law is a major part of the defendant’s argument in a lawsuit filed by a medical marijuana patient alleging violations of the New Jersey Law Against Discrimination (NJLAD). Wild v. Carriage Services, No. L-000687-17, complaint (N.J. Super. Ct., Bergen Cty., Jan. 30, 2017). In a motion to dismiss filed in February 2017, the defendant in Wild argues that the NJCUMMA directly conflicts with the CSA. Courts have dismissed several similar lawsuits recently on procedural grounds that do not address the merits of the medical marijuana claims. See Barrett v. Robert Half Corp., No. 2:15-cv-06245, order (D.N.J., Feb. 21, 2017); Wiltshire v. Breunig, et al, No. L-000052-16, complaint (N.J. Super. Ct., Cape May Cty., Feb. 5, 2016).

volunteersNew Jersey employment laws protect workers’ rights in multiple areas, including wages and hours of work, discrimination and harassment, and retaliation for reporting suspected wrongdoing by an employer. Many of these laws apply specifically to “employees,” but no single definition of “employee” exists. Some statutes only cover paid employees, while others also apply to independent contractors, unpaid interns, or volunteers. The legal status of unpaid workers, including both interns and volunteers, has been the subject of multiple court battles. The New Jersey Appellate Division recently held that the state’s whistleblower statute, the Conscientious Employee Protection Act (CEPA), does not apply to unpaid volunteers. Sauter v. Colts Neck Volunteer Fire Co. No. 2, No. A-0354-15T1, slip op. (N.J. App., Sep. 13, 2017). In light of this decision, it is worth reviewing how various employment statutes in New Jersey view unpaid volunteers and interns.

“Volunteer” Versus “Intern”

Some laws make a distinction between volunteers and interns. Generally speaking, an internship provides some form of educational benefit to the worker, possibly including course credit at an educational institution, and it may be paid or unpaid. Even when an internship is unpaid, the worker is considered to gain an educational benefit. A volunteer position, on the other hand, is usually undertaken for primarily altruistic reasons, or at least without the expectation of any specific return.

A person’s job can be one of the most important features of their identity. When two people meet for the first time, for example, one of the first questions asked is very often “What do you do?” One’s job serves other purposes, such as the obvious purpose of providing income to support oneself and one’s family. Finding a job is important, but losing a job can be devastating. New Jersey labor laws protect workers in many aspects of the employer/employee relationship, including limiting the ability of some employers to fire numerous employees all at once. Laws like the Worker Adjustment and Retraining Notification (WARN) Act of 1988 apply to large employers that are planning a mass layoff of employees. The Third Circuit Court of Appeals recently ruled on a claim brought under the WARN Act involving a company that had been sold as part of a bankruptcy case. In re AE Liquidation, Inc., No. 16-2203, slip op. (3rd Cir., Apr. 4, 2017).

After Layoff - EmptyThe WARN Act applies to businesses with at least 100 full-time employees. 29 U.S.C. § 2101(a)(1). Covered employers must provide advance notice to employees prior to a “mass layoff.” The statute defines a “mass layoff” as the termination of a large number of employees within a 30-day period that is not related to a plant closing. For the WARN Act to apply, the layoff must affect either (1) at least 50 full-time workers, who constitute at least one-third of the total full-time workforce; or (2) at least 500 full-time employees. Id. at § 2101(a)(3).

An employer must provide at least 60 days’ notice to “affected employees” before undertaking a plant closing or mass layoff. Id. at § 2102(a). Aggrieved employees may recover damages for violations that include up to 60 days of back pay. Id. at § 2104. New Jersey has a similar law that requires additional disclosures from employers and allows claims for compensatory damages. N.J. Rev. Stat. §§ 34:21-3, 34:21-6.

Disability SymbolsNew Jersey employees are protected against discrimination under federal and state laws, as well as municipal anti-discrimination ordinances in many cities around the state. The New Jersey Law Against Discrimination (NJLAD) covers a broad range of protected categories, including disability. In addition to prohibiting discrimination based on an employee’s disability, the law also requires employers to provide reasonable accommodations for employees with disabilities. A jury recently found in favor of a former corrections officer in a New Jersey disability discrimination lawsuit, awarding her about $11.8 million in damages. Pritchett v. State of New Jersey, No. L-002189-13, complaint (N.J. Super. Ct., Mercer Cty., Oct. 10, 2013).

Under the NJLAD, an employer cannot discriminate against a worker “because such person is or has been at any time disabled.” N.J. Rev. Stat. §§ 10:5-4.1, 10:5-12. This applies to people with disabilities and people who are “perceived as having a disability.” Victor v. State, 4 A.3d 126, 142 (N.J. 2010). The NJLAD’s definition of a “disability” is also “significantly broader” than that of the federal Americans with Disabilities Act. Id. at 142 n. 11. Exceptions apply when a particular person’s particular disability “would prevent such person from performing a particular job.” N.J. Rev. Stat. § 10:5-29.1; Raspa v. Office of Sheriff, 924 A.2d 435, 442-43 (N.J. 2007).

The NJLAD also requires employers to make reasonable accommodations for employees with disabilities, provided this does not “impose an undue hardship on the operation of its business.” N.J.A.C. 13:13-2.5(b). Reasonable accommodations might include modifications of facilities and equipment for accessibility, flexible or modified work schedules, or reassignment of certain job duties. Factors employers may consider when determining whether something constitutes an undue burden include the nature of their business, the size of their operation and facilities, and the potential cost of the accommodations.

Unemployment OfficeNew Jersey employment laws protect the rights of employees in a wide range of areas, including workers’ right to unemployment compensation, subject to various conditions. State agencies and the courts are charged with ensuring that employers and the state fairly apply the rules regarding eligibility for unemployment compensation. The New Jersey Superior Court, Appellate Division, recently invalidated part of a rule adopted by the state’s Department of Labor and Workforce Development (LWD). The challenged rule defined “misconduct,” in the context of unemployment, in a way that the court found “arbitrary and capricious.” In re N.J.A.C. 12:17-2.1, No. A-4636-14T3, slip op. at 3 (N.J. App., May 1, 2017). A consistent definition of “simple misconduct,” the court held, is required to protect workers’ rights.

The New Jersey Unemployment Compensation Law (UCL) states that eligible individuals shall receive benefits for a set period of time after they become “unemployed,” within the meaning established by the statute. See N.J. Rev. Stat. §§ 43:21-3, 43:21-19(m)(1). Benefits are paid from an unemployment insurance program funded by payroll tax deductions and employer contributions. In order to obtain benefits, an individual must file a claim with LWD. See N.J. Rev. Stat. §§ 43:21-4, 43:21-6.

An individual may be disqualified from eligibility for unemployment benefits if they were “suspended or discharged for misconduct” by their previous employer. Id. at § 43:21-5(b). The employer has the opportunity to respond to a former employee’s unemployment claim, including with allegations of misconduct. The statute identifies three levels of “misconduct”:  simple, severe, and gross misconduct. The challenged LWD rule, codified at N.J.A.C. 12:17-2.1, defines the three levels of misconduct.

SeoulIn 2015, a group of technology companies settled a class action filed on behalf of thousands of employees for about $415 million. The lawsuit alleged that the defendants violated antitrust laws by entering into “anti-poaching” agreements, by which they agreed not to solicit or hire each other’s employees. These types of agreements make it difficult, if not impossible, for workers to advance in their fields, and they also tend to drive wages downward. More recently, a putative class action that partly originated in New Jersey made similar allegations against two major electronics companies. Frost v. LG Corp., et al., No. 5:16-cv-05206, complaint (N.D. Cal., Nov. 8, 2016). A judge granted the defendants’ motion to dismiss the case in April 2017, based on pleading defects, but will allow the plaintiffs to make corrections in an amended complaint. The case remains a good example of how state and federal antitrust laws can affect employment.

The main federal antitrust statute is the Sherman Act, originally enacted by Congress in 1890 in an effort to address monopolistic practices across the country. It prohibits any “contract…in restraint of trade or commerce among the several states,” 15 U.S.C. § 1, and allows both civil and criminal penalties. The New Jersey Antitrust Act uses almost identical language to describe prohibited contracts. N.J. Rev. Stat. § 56:9-3. The attorneys general at the state and federal levels are empowered to investigate and prosecute anticompetitive practices, and both state and federal laws allow civil causes of action by aggrieved parties.

The Frost lawsuit is actually a consolidation of two lawsuits filed in California and New Jersey. It asserts claims on behalf of three classes of employees:  nationwide, in California, and in New Jersey. The two defendant employers are American subsidiaries of South Korean companies. Their parent companies are also named as defendants. The lead plaintiff for the New Jersey class worked for one of the defendants in Englewood Cliffs for about eight years, beginning in 2006.

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stock chartAccording to some analysts, New Jersey is experiencing a net loss of residents and businesses, which means it is also losing jobs. When a business decides to cease operations in an entire state, a significant amount of job loss is probably inevitable, but the state has enacted laws that offer some protection to workers in this type of situation. The NJ WARN Act, more officially known as the Millville Dallas Airmotive Plant Job Loss Notification Act of 2007, establishes procedures that many businesses must follow when they take certain actions that result in major job loss. This includes a detailed notification that must be provided to each affected worker. Employers that fail to provide the required notification may be liable for damages to their employees.

The NJ WARN Act generally applies to businesses that have operated in New Jersey for at least three years and that have 100 or more full-time employees. Their obligations under the statute are triggered by certain events, including a “mass layoff,” a “transfer of operations,” and a “termination of operations.” N.J. Rev. Stat. § 34:21-1. The statute defines a “mass layoff” as a “reduction in force” that is not related to a transfer or termination of operations and that results in the termination of (1) at least 500 employees within a 30-day period, or (2) at least 50 employees when that number represents at least one-third of the company’s total full-time workforce. Id. A termination of operations occurs when the company voluntarily closes an entire facility, either permanently or temporarily. A transfer of operations involves moving a facility to another location.

If an employer conducts a mass layoff or a transfer or termination of operations that causes equivalent job loss, the NJ WARN Act requires it to provide a notification to each affected employee, along with severance pay “equal to one week of pay for each full year of employment.” Id. at § 34:21-2(b). The notification must state the number of employees losing jobs, an explanation of why the employer is undertaking these actions, a breakdown of the severance pay, statements of the employee’s legal rights, and information about comparable jobs available with the employer. Id. at § 34:21-3.

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