In what I hope does not become a weekly feature here at The Employer Handbook, it’s time to update the readers on some new laws that NJ Governor Phil Murphy signed last week.
Stop Work Orders. Let’s say that the State of New Jersey learns that your business may be violating a state wage, benefit, or tax law. So, the New Jersey Department of Labor and Workforce Development (NJDOL) comes in and audits or investigates. If the NJDOL initially determines that your business violated literally any state wage, benefit, or tax law, then the NJDOL Commissioner may issue a stop-work order. You’ll get seven days’ notice. But, that order will require your company to stop all business operations at the specific place of business or employment in which the violation exists. The fines for violating the stop work order are up to $5,000 per day. Don’t believe me? Read about it here.
Penalties for misclassification of employees. If the NJDOL Commissioner finds that your business has misclassified employees (e.g., you call an employee an independent contractor) then, in addition to imposing any other remedies or penalties authorized by law, the NJDOL Commission can hit you with:
- an administrative “misclassification penalty” up to a maximum of $250 per misclassified employee for a first violation and up to a maximum of $1,000 per misclassified employee for each subsequent violation; and
- a penalty to be provided for the misclassified worker of not more than 5 percent of the worker’s gross earnings over the past twelve months from the employer who failed to properly classify them. The employer may be required to make these penalty payments to the commissioner to be held in a special account in trust for the worker or workers, or paid on order of the commissioner directly to the workers or workers affected.
More on that here.
Joint liability for payment of employer tax law. A client employer and a labor contractor providing workers to the client employer are both responsible for any violations of the provisions of State wage and hour laws or State employer tax laws. In fancy lawyer-speak, we call that ‘joint and several liability.’ Both the client employer and the labor contractor may be subject to any remedy provided for violations of those laws.
I know what you’re thinking. We’ll just get the contractor to sign a waiver. Uh, no. A waiver is contrary to public policy and is void and unenforceable.
Read all about it here.
Employers must post notice for employees on employee misclassification. Each employer required to maintain and report records regarding wages, benefits, taxes, and other contributions and assessments — so basically, any NJ business — must post a conspicuous notice at work, explaining:
- The prohibition against employers misclassifying employees;
- The differences between employees and independent contractors;
- The benefits and protections to which an employee is entitled under state wage, benefit, and tax laws;
- The remedies under New Jersey law to which workers affected by misclassification may be entitled; and
- Information on how a worker or a worker’s authorized representative may contact, by telephone, mail, and e-mail, a representative of the commissioner to provide information to, or file a complaint with, the representative regarding possible worker misclassification.
The NJDOL Commissioner is working on that poster right now.
The first three laws go into effect right away. The notice requirement kicks in in April.
Now, if you’ve lost your appetite and won’t be finishing that pork roll and egg sandwich, please pass it over here.