Compliance Corner: Wage Theft

Earlier this year, New Jersey Governor Phil Murphy signed the New Jersey Wage Theft Act. The latest of its kind in the U.S., this law is also one of the strongest wage theft laws in the U.S. and requires employers to provide current and newly hired employees with a written statement of their wage rights.

In addition, the law:

  • Prohibits retaliation against employees who complain about wage theft violations
  • Permits employees to sue employers for violations, including attorney’s fees and damages
  • Increases punishments for violations, including increased fees and the potential for jail time
  • Expands employer liability
  • Extends the current statute of limitations to six years
  • Expands the New Jersey Department of Labor’s (NJDOL) ability to investigate wage theft
  • Increases audits
  • Enables the NJDOL to issue stop-work orders or direct agencies to suspend licenses held by the employer if the employer fails to comply with court judgements and NJDDOL determinations
  • Provides joint liability with staffing agencies
  • Empowers the NJDOL to contract with community based and legal services organizations
  • Enables the NJDOL to publicly post the names and addresses of violating employers
  • Creates the crime “pattern of wage nonpayment” that applies when an employer knowingly violates the law for a third time; it is punishable by fines and jail time

Two other jurisdictions also passed similar legislation. The state of Minnesota passed the Minnesota Wage Theft Prevention Act in June, and the city of Minneapolis followed in July with a similar ordinance.

Employers in all relevant jurisdictions should ensure that they are in compliance with all aspects of the law and anticipate significant enforcement in the coming months and years.

Compliance Corner is a feature from PeopleScout. Once a month, we’ll be featuring a compliance issue that’s in the news or on our minds. Understanding the patchwork of labor laws across the world is complicated, but it’s part of what we do best. If you have questions on the compliance issue discussed in this post, please reach out to your PeopleScout account team or contact us at marketing@peoplescout.com.

Post by Nicole Fuqua