New Jersey Lawmakers Pass Equal Pay Legislation

The New Jersey Legislature recently passed two bills designed to strengthen existing equal pay laws. If signed into law, employers could face increased liability, as well as additional regulatory burdens.

The Unfair Wage Recovery Act

The proposed wage legislation amends the New Jersey Law Against Discrimination (NJLAD) so that a discriminatory compensation decision or other employment practice that is unlawful under the statute occurs each occasion that compensation is paid in furtherance of that discriminatory decision or practice. Accordingly, each discriminatory paycheck or similar violation “restarts” the applicable statute of limitations governing discriminatory compensation claims under the NJLAD.

The legislation would bring New Jersey law into conformity with the Lilly Ledbetter Fair Pay Act of 2009. The federal law clarified that, under various federal anti-discrimination laws, including the Civil Rights Act of 1964, an unlawful discriminatory compensation decision occurs each time wages, benefits, or other compensation are paid to an individual.

The New Jersey law states that it will not restrict a court’s authority to apply the “continuing violation” doctrine; is not intended to weaken or eliminate any potential equitable application of the “discovery rule”; and will not affect any applicable statute of limitation. However, the true impact of the law remains to be seen.

The Wage Transparency Act

In an attempt to uncover wage disparities, the bill requires public contractors to report to the Commissioner of Labor and Workforce Development, throughout the duration of the contract or contracts, information regarding the gender, race, job title, occupational category, and total compensation of every employee of the employer employed in New Jersey in connection with the contracts.

Under the proposed legislation, employers would also have to provide an update each time there is a significant change in the information required to be reported, or other significant change in employment status, including, but not limited to, medical leave of 12 weeks or more, hiring, termination for any reason, a change in part-time or full-time status, or a change in “employee” or “contractor” status.

If you have any questions about the proposed wage legislation or would like to discuss your company’s wage practices, please contact me or the Scarinci Hollenbeck Labor and Employment attorney with whom you work.