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The Employer Handbook Blog
New Jersey’s New Reinstatement Right Could Blindside Employers Who Thought They Knew the Rules
In January, then-Governor Phil Murphy signed a law creating a reinstatement right that never existed before. For employers of any size. It takes effect July 17, and even employers confident they’ve got employee-leave compliance handled could be blindsided.
TL;DR: Starting July 17, 2026, New Jersey employers must reinstate any employee who took paid Temporary Disability Insurance (TDI) or Family Leave Insurance (FLI) benefits, regardless of company size or how long the employee has worked there. The law also lowers the threshold for full New Jersey Family Leave Act (NJFLA) coverage from 30 employees to 15.
A Reinstatement Right That’s Never Existed Before
New Jersey runs two paid leave programs, Temporary Disability Insurance (TDI) and Family Leave Insurance (FLI). Here’s the part easy to miss: employees who receive those benefits will now have a right to reinstatement after their leave ends, no matter how small the employer or how new the employee. That right attaches to receiving the benefit itself, not to separately qualifying under a broader leave law.
That closes a gap. TDI and FLI are wage-replacement benefits funded through payroll deductions, and eligibility turns on earnings, 20 weeks at $310 or more, or $15,500 combined over the base year, not employer size or tenure. Job protection used to depend on separately qualifying for the New Jersey Family Leave Act (NJFLA) or the federal FMLA, both carrying minimum employer-size and tenure requirements. An employee at a five-person shop could draw TDI checks for months and legally come back to find the position gone. That’s no longer true.
If the leave isn’t already covered by NJFLA or FMLA, receiving TDI or FLI benefits alone will trigger a right to return to the same job, or one with the same pay, benefits, seniority, and other terms, once leave ends. There’s no employer-size floor and no minimum tenure requirement for this protection.
The law also lowers the bar for NJFLA. Coverage will kick in at 15 employees instead of 30, after 3 months of tenure instead of 12, and 250 hours worked instead of 1,000. Employers who never had to think about NJFLA compliance under the old 30-employee threshold may soon be inside it.
The reinstatement provision comes with remedies attached: civil fines of $1,000 to $2,000 for a first violation and up to $5,000 for each subsequent one, common-law tort damages, reinstatement, lost wages and benefits, and costs and attorney’s fees. It stands as its own cause of action, separate from NJFLA or FMLA.
None of this changes what TDI or FLI benefits pay out, or who qualifies for the cash benefit. What’s changing is what happens to the job while the employee is drawing it. Before July 17, check whether your leave and reinstatement policies were written assuming a minimum headcount that won’t protect you much longer.
Perhaps I know someone who can help with that.
Employer Size No Longer Shields You From This Specific Reinstatement Duty
If an employee receives TDI or FLI benefits and their leave doesn’t independently qualify under NJFLA or FMLA, they still get a reinstatement right. Audit any policy language tying job protection to a minimum employee count; that assumption won’t hold for TDI/FLI leave.
A Three-Month Employee Will Trigger Full NJFLA Obligations
The tenure threshold for NJFLA dropped from 12 months to 3, and the hours requirement from 1,000 to 250. Employees who would have been too new to qualify last year may already be covered. Update onboarding materials and manager training to reflect the shorter runway.
Fifteen Employees Is the New Line for Full NJFLA Coverage
Employers who sat comfortably under the old 30-employee threshold should recheck their headcount against the new 15-employee floor. Crossing that line means adopting NJFLA’s full 12-week job-protected leave framework, not just the narrower TDI/FLI right.
This Reinstatement Right Comes With Its Own Penalties, Not Just an Add-On to FMLA Risk
Violations can trigger civil fines, tort damages, and attorney’s fees as a standalone claim, separate from any NJFLA or FMLA exposure. Treat a refusal to reinstate a TDI/FLI leave-taker with the same seriousness as a retaliation claim under existing leave laws.
The law didn’t make paid leave more generous. It made not reinstating someone after paid leave a lot more expensive.
More detail is available on the state’s job protection page and its FAQ for employers.