Wage and Hour Disputes

March 17, 2023

New Labor Department Guidance Could Help New Jersey Remote Workers

The Fair Labor Standards Act (FLSA) establishes a minimum wage for the entire country, requires employers to pay overtime when employees work more than forty hours during a week, and provides other protections for workers’ rights. A significant increase in the number of people working remotely over the past few years has raised questions about what constitutes “work time” away from the workplace. Non-exempt employees are entitled to pay for short break periods under the FLSA and New Jersey employment laws. Court decisions and administrative cases addressing this issue, however, have mostly involved time that non-exempt employees have spent in the workplace. The U.S. Department of Labor’s Wage and Hour Division (WHD) issued a Field Assistance Bulletin (FAB) in February 2023 that discusses break time for remote workers under the FLSA. Its conclusions are favorable towards the employees. While the FAB does not have the force of law, courts may be able to rely on it should this issue reach them.

FLSA regulations generally require employers to pay employees for job duties that they have performed, even if the employer did not specifically request it. For example, an employer must pay an employee who continues to work past the end of their shift in order to finish an assignment. This also applies when the employee performs the work off-site, including at the employee’s home.

An employee’s compensable time is not necessarily limited to the time they are actively engaged in their job duties. As a general rule, employees are entitled under the FLSA to get paid for rest breaks, but not meal breaks. Regulations define a rest break as a break lasting no more than twenty minutes that serves to “promote the efficiency of the employee.” “Bona fide meal periods,” as defined by the regulations, typically last at least thirty minutes. They are not considered compensable work time as long as the employee is relieved of all work responsibilities. The question for the WHD involves how these rules apply to remote workers.
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February 10, 2023

Pay Equity and Transparency Laws in New Jersey

by Resnick Law Group, P.C.

Pay disparities among employees are a common form of employment discrimination. Wage gaps exist based on sex, race, and other categories that are protected by New Jersey employment laws. Addressing the problem can be difficult because the evidence is often hidden from view. Many employers have tried, for example, to prevent employees from discussing their wages. State and federal laws now protect employees’ ability to talk about how much they get paid, but a great deal of information remains concealed. A new pay transparency law in New York City requires employers to disclose pay ranges when they advertise job openings. So far, only one city in New Jersey has this type of law. Advocates for pay transparency laws say that they will help address wage gaps among employees.

Several laws address wage disparities and discrimination in New Jersey. These include the following issues:
– Pay equity;
– Attempts by employers to prevent employees from discussing their rates of pay; and
– Pay transparency.

Pay Equity

The federal Equal Pay Act (EPA), found at 29 U.S.C. § 206(d), prohibits wage discrimination based on sex or gender. Generally speaking, employers must pay employees of any gender the same amount for work that “requires equal skill, effort, and responsibility,” and that employees “perform[] under similar working conditions.” Exceptions include systems based on merit, seniority, “quantity or quality of production,” or “any other factor other than sex.”
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January 6, 2023

New Jersey Employment Laws Limit Working Hours for Minors

by Resnick Law Group, P.C.

Children working in dangerous jobs are a common feature in many famous photographs from the late 19th and early 20th centuries. Child labor was common in mines, factories, and other hazardous workplaces until the 1930s when the U.S. Congress passed the Fair Labor Standards Act (FLSA). That law sets strict limits on employment for minors, including the kinds of jobs they may have and the number of hours they may work. New Jersey employment laws also regulate the hours that minors may work. The New Jersey Attorney General (NJAG) recently announced that it had settled a dispute with a restaurant chain over alleged child labor law violations. As part of the settlement, the employer reportedly agreed to pay $7.75 million in damages and fines.

The FLSA’s provisions on child labor prohibit anyone under the age of 14 from working in most jobs. Exceptions may apply with regard to jobs in agriculture, jobs within one’s family, newspaper delivery, and acting for film or television. The original purpose of the FLSA was to prevent children from working long hours in dangerous conditions. Children who are 14 or 15 years old may work limited hours in certain jobs. Between the ages of 16 and 17, the FLSA allows children to work in non-hazardous jobs for a longer number of hours.

Despite many advances in this area, child labor remains an issue throughout the country. A report on children’s rights by the organization Human Rights Watch assigned a letter grade from “A” to “F” to each state based on multiple factors, including child labor laws. While New Jersey received one of the highest grades in the country, it was still only a “C.”

December 2, 2022

New Proposed Independent Contractor Rule Could Help New Jersey Workers

by Resnick Law Group, P.C.

Employment laws in New Jersey and at the federal level guarantee a minimum wage and overtime pay for many employees, as well as many other protections. In order to take advantage of these legal safeguards, a worker must demonstrate that an employment relationship exists between them and their employer. The definition of an “employee” in federal and New Jersey employment statutes is rather vague. The U.S. Department of Labor (DOL) recently issued proposed rules that would establish a new test to determine whether a worker is an employee or an independent contractor. The current rule, which the DOL put in place under the previous presidential administration, is generally favorable to employers. New Jersey’s rule for state law claims presumes that a worker is an employee unless an employer can prove otherwise.

The employer-employee relationship is a complicated concept, legally speaking. It draws on legal theories about an employer’s authority to exert control over a person. For example, how much say does an employer have over when, where, and how a worker does their job? Do they have a specific workstation, monitored by supervisors, where the worker must be during specific working hours? If so, the worker is probably an employee. An independent contractor typically has more autonomy over their work. A large body of federal and state laws protect employees’ rights. An independent contractor’s rights depend on the terms of their contract with the employer.

The DOL’s current rule tends to favor employers. Unlike the New Jersey rule, the federal rule does not presume employee status. It uses two “core factors” to determine a worker’s status: (1) How much control is the worker able to exert over their work? (2) Are they able to earn more money by any means other than increasing their production or working more hours? The more control a worker has over their work and their income, the more likely a federal court will be to classify them as an independent contractor.
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November 4, 2022

New Jersey Class Action Alleges Wage Violations at Theme Park

by Resnick Law Group, P.C.

Workers are entitled to payment for all hours that they perform work for their employers under federal and New Jersey employment laws. Employers must pay non-exempt employees at a rate equal to or greater than the minimum wage set by state law. They must also pay all wages owed to their employees at the end of each pay period. Employers who fail to meet these duties could be liable to their employees for damages. A worker at a New Jersey theme park recently filed a class action in federal court alleging state wage law violations. She claims that the defendant required employees to perform unpaid work both before clocking in and after clocking out.

The lawsuit cites three provisions of New Jersey law. First, the New Jersey Wage and Hour Law (NJWHL) requires employers to pay at least minimum wage to their non-exempt employees. In 2022, the statewide minimum wage is $13 per hour. It will increase to $14.13 per hour on January 1, 2023. It will continue to increase annually until it reaches $15 per hour at the beginning of 2026.

New Jersey employment regulations require employers to pay their workers “for all hours worked.” This generally includes all activities required by employers, particularly those on the employer’s premises. The plaintiff cites two decisions from the U.S. Supreme Court addressing what sorts of activities count as compensable work:
– In Tennessee Coal, Iron & R. Co. v. Muscoda Local No. 123 (1944), the court held that iron ore miners were entitled to pay for the time they spent traveling to and from the “working face” of the mine. The trip often involved a precarious journey of 3,000 to 12,000 feet through dark underground tunnels.
– The plaintiffs in Anderson v. Mt Clemens Pottery Co. (1946) had to walk across an eight-acre facility to get from the time clocks to their work areas. This could take up to an hour each day. The court held that this time was compensable.
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October 21, 2022

Bill Pending in New Jersey Legislature Would Improve Rights for Temporary Workers

by Resnick Law Group, P.C.

New Jersey employment laws protect workers against multiple kinds of abuses by employers, such as failure to pay minimum wage or overtime, requiring unpaid work time, and unlawful payroll deductions. Both state and federal statutes address wage and hour violations, but these protections only apply to “employees.” The legal definition of this term rarely includes temporary workers. A bill pending in the New Jersey Senate would create a “Temporary Workers Bill of Rights” that extends many of the legal protections enjoyed by employees to people who work for staffing agencies. The bill has faced multiple hurdles since its introduction in early 2022. While its future is uncertain, lawmakers in support of the bill say it still has a chance at passage.

The federal Fair Labor Standards Act (FLSA) and the New Jersey Wage and Hour Law (WHL) set a minimum wage for non-exempt employees. They also require employers to pay non-exempt employees time-and-a-half for any time they work over forty hours in a week. Neither statute has a detailed definition of “employee.” They both define the term as “any individual employed by an employer.” The protections offered by these laws often do not extend to individuals who work for staffing agencies contracted by other companies to provide temporary workers.

In the most recent version of the pending bill, A1474, the Legislature states several findings related to temporary workers and their working conditions. “[T]emporary help service firms, sometimes referred to as temp agencies or staffing agencies,” employ about 127,000 people in New Jersey. The state has licensed around one hundred temp agencies, while an unknown number of unlicensed agencies “operate outside the purview of law enforcement.” Temporary jobs are heavily concentrated in “service occupations,…production, transportation, and material moving occupations and manufacturing industries.”
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August 26, 2022

Appeals Court Sets Limits on FLSA Collective Actions in New Jersey and Other States

by Resnick Law Group, P.C.

Both federal and state employment laws in New Jersey protect employees’ rights to a minimum wage and overtime pay. While the federal Fair Labor Standards Act (FLSA) does not set the minimum wage as high as New Jersey law, it provides workers with useful enforcement tools. A worker can bring a “collective action” on behalf of other workers with similar federal wage and hour claims. An FLSA collective action is similar to a federal class action, with a few important differences. A recent decision by the Third Circuit Court of Appeals limits the use of FLSA collective actions when the plaintiffs come from more than one state. The ruling should not affect collective actions in which all members of the group are from New Jersey. If you have concerns about possible wage or overtime pay violations, make an appointment with a New Jersey employment lawyer today.

The most recent increase in the federal minimum wage occurred over twelve years ago. It reached its current level of $7.25 per hour on July 24, 2010. The rules for overtime compensation, which require payment at time-and-a-half for time worked over forty hours in a week, have remained the same for decades. These rules only apply to employees who are not exempt under the FLSA. They also do not apply to independent contractors. A wrongful claim that an employee is either exempt or an independent contractor is a violation of the FLSA known as employee misclassification.

The FLSA allows employees to file lawsuits against their employers for alleged wage and hour violations. Notably, § 16(b) of the FLSA allows employees to file suit on their own behalf and on behalf of “other employees similarly situated.” The requirements for a collective action under the FLSA are similar to those for a class action under Rule 23 of the Federal Rules of Civil Procedure. One important difference is that, while many class actions automatically include people who meet the description of class members and receive notice of the suit, the FLSA requires all plaintiffs to consent to participation in a collective action in writing. To put that another way, people may have to “opt out” of a class action and “opt in” to a collective action.
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August 1, 2022

Supreme Court Ruling May Affect Mandatory Arbitration for Some New Jersey Workers

by Resnick Law Group, P.C.

Arbitration can allow the parties to a dispute to avoid the time and expense of litigation. More and more businesses are including clauses in consumer and employment contracts that require the parties to go to arbitration before filing a lawsuit. In some situations, arbitration may tend to favor businesses over individuals for numerous reasons. New Jersey lawmakers have attempted to limit the availability of mandatory arbitration contracts for certain claims, but several courts have ruled that the Federal Arbitration Act (FAA) precludes such laws. The FAA grants broad approval to arbitration contracts and arbitration awards. It also excludes certain groups of workers from its provisions. The U.S. Supreme Court recently ruled in favor of an airline employee who objected to arbitration of her overtime compensation claims. The ruling in Southwest Airlines Co. v. Saxon held that the employee is a “transportation worker” who is exempt from the FAA. If you have questions regarding arbitration in the workplace, contact a New Jersey employment lawyer to discuss your situation.

An arbitration proceeding resembles litigation in many ways. Both parties to a dispute must agree in advance to use arbitration. The parties present evidence and arguments to a neutral third party, known as the arbitrator. After considering both sides’ cases, the arbitrator may make an award that is similar to a verdict.

The FAA states that arbitration agreements are generally “valid, irrevocable, and enforceable,” except when they might not be under contract law principles like fraud or duress. If an arbitration agreement specifically states that the arbitrator’s award will be binding, the FAA limits courts’ authority to do anything other than confirm the award and enter it as a judgment, with few exceptions. Courts can only vacate or modify an arbitrator’s award with evidence of corruption, fraud, other forms of misconduct, or significant errors.
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July 25, 2022

New Jersey Judge Rules for Employee in Misclassification Lawsuit

by Resnick Law Group, P.C.

New Jersey’s employment laws guarantee a minimum wage and overtime compensation for millions of workers. They protect employees from various forms of discrimination and harassment in the workplace. They bar employers from retaliating against workers who object to unlawful or unethical conduct. In order to enjoy the benefits of state and federal employment laws, however, a worker must be an “employee.” The definition of “employee” can be ambiguous and subject to debate. Employers may try to describe an employee as an independent contractor in order to avoid obligations set by state wage and hour laws and other statutes. New Jersey has developed a test for determining whether an individual is an employee. A federal judge recently granted summary judgment for a plaintiff in a wage and hour dispute.

Wrongfully categorizing an employee as an independent contractor is known as “employee misclassification.” It is considered a violation of wage and hour laws when an employer does it in order to avoid obligations established by those laws. New Jersey has adopted the “ABC test” to determine whether a worker is an employee or not. The test receives its name from the definition of “employment” found in New Jersey’s Unemployment Compensation Law at N.J. Rev. Stat. § 43:21-1(i)(6)(A) through (C).

A worker is presumed to be an “employee” under the ABC test unless they meet all three of the following criteria:
A. The employer does not exercise “control or direction” over the worker’s job duties and job performance.
B. Either the services the worker performs are “outside the [employer’s] usual course of…business,” or they perform those services “outside of all the [employer’s] places of business.”
C. The worker’s services are normally part of their own “trade, occupation, profession or business,” which is separate from the employer’s business.
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May 27, 2022

Can New Jersey Employers Pay Wages in Cryptocurrency?

by Resnick Law Group, P.C.

Cryptocurrency has been in the news lately. Its advocates point to features like transparency, decentralization, and a lack of connection to any nation’s laws or banking systems. They tout its potential for replacing national currencies like the dollar or the euro. Critics note that cryptocurrency transactions require tremendous amounts of energy and that it often functions more as a form of investment property than currency. For New Jersey employees, this raises a question that has not received a great deal of attention in the legal world yet. Can employers pay their employees in cryptocurrency? New Jersey’s wage and hour laws seem to suggest that employers cannot, or should not, do this at the present time.

What Is Cryptocurrency?

Cryptocurrency is a type of digital or virtual money. It uses a technology known as “blockchain” to record transactions. A blockchain is an open-source ledger that records every cryptocurrency transaction. It also records the creation of new cryptocurrency, which is a process known as “mining.” These processes are distributed across computers all over the world. The first cryptocurrency, Bitcoin, first appeared in 2008 and remains the largest and most famous example.

In principle, people can use cryptocurrency as a medium of exchange. Few businesses accept cryptocurrency as payment, though. Many people buy and sell cryptocurrency as investments, somewhat similar to the way investors buy and sell stocks and other securities.
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