When people think about wage and hour claims, they usually think of minimum wage violations. However, state and federal labor laws govern many other areas of employer conduct, including when to pay employees, overtime pay, child labor, breaks, recordkeeping, and other wage and hour matters.
Companies must follow many rules and regulations, both nationally and at the state level in New Jersey. Even diligent business owners can sometimes find themselves on the wrong side of a legal dispute regarding their wage and hour practices.
The first step in avoiding wage and hour claims is understanding the laws governing New Jersey employers. Guidance from New Jersey wage and hour lawyers with experience in labor law can assist you in reducing the number and severity of wage and hour claims you might face.
Wage and hour claims in New Jersey
Most employers are subject to the federal Fair Labor Standards Act (FLSA). The act sets minimum wage and overtime pay for employees nationwide.
However, the FLSA only sets a minimum standard.
An overview of New Jersey wage and hour laws
New Jersey has a higher minimum wage for employees than the standard federal rate of $7.25 per hour (which has remained the same for 14 years).
Other state laws offer additional wage and hour protections for employees, such as:
- New Jersey State Earned Sick Leave Law
- New Jersey State Wage and Hour Laws and Regulations
- New Jersey State Prevailing Wage Act and Regulations
- New Jersey State Child Labor Laws and Regulations
- New Jersey State Wage Payment Law
Some laws apply to specific industries, such as seasonal agricultural labor, health care, state building services, and construction.
Furthermore, municipalities can enact additional laws regarding rights and protections for employees working within their jurisdiction.
Because there are so many overlapping policies, employers often struggle to determine which laws and regulations apply to them.
Enforcement of New Jersey wage and hour laws
It is important for employers facing wage and hour claims to understand when FLSA applies and when it does not.
Not all New Jersey employers or employees are subject to the federal statute of the FLSA. In cases where they are not, New Jersey labor laws govern. However, courts have tended to interpret interstate commerce very broadly, and hence the FLSA applies in most cases.
Wage and labor laws in New Jersey are enforced by the U.S. Department of Labor’s Wage and Hour Division and the New Jersey Department of Labor and Workforce Development. The applicable law in a particular wage and hour claim determines which government agency hears an employee’s complaint.
Common types of wage and hour claims
Wage and hour claims cover a wide variety of issues related to employee compensation, which can include:
- Minimum wage violations
- Improper wage deductions
- Refusing to pay overtime wages
- Failure to provide required rest and meal breaks
- Misclassification of exempt employees
- Violating laws governing earned sick leave, health benefits, and fringe benefits
- Failing to reimburse employees for covered expenses
- Improperly classifying workers as independent contractors
- Requiring off-the-clock work
- Improper tip and service charge practices
- Violations regarding payment of final paycheck
- Improperly withholding or diverting an employee’s wages
- Failing to pay an agreed-upon salary
Consequences for wage and hour violations in New Jersey
New Jersey employers can face severe penalties for violating wage and hour laws. Depending on the violation and the applicable law in question, the employer could face large fines or jail time. The state could also charge penalties for withholding an employee’s wages. Repeated violations of wage and hour laws by employers significantly increase the penalties.
Companies can purchase employment practices liability insurance to help protect them from losses due to employment claims. However, the insurance might not cover all costs associated with employment-related claims. It is important to take proactive steps to avoid these claims.
Defending against wage and hour claims
When an employee files a wage and hour complaint, the government agency tasked with enforcing the applicable law investigates the claim and can file a lawsuit if it finds that an employer has acted illegally.
Companies accused of wage and hour violations in New Jersey need to provide evidence of their practices and policies to assemble their defense. Therefore, it is essential to maintain complete and accurate employee records.
How wage and hour claims attorneys can protect your business
When a wage and hour case is brought against a New Jersey employer, their counsel handles communications with the investigating government agency. They ensure timely responses are filed during the audit or inquiry, provide advice, and protect the company’s legitimate interests throughout the legal process.
Attorneys must often rely on employer records to respond adequately to employee wage and hour claims and mount a defense, sometimes by proving that the employee was in a legally exempt category. Other potential defenses could include the expiration of the statute of limitations and the good faith defense. Sometimes, the government agency in question lacks jurisdiction over the matter, or the law being cited does not apply.
An experienced New Jersey employment attorney can identify the right course of action in response to a wage and hour claim and prepare to provide a defense in court, if necessary.
Three ways to be proactive in avoiding wage and hour claims
Waiting until a problem arises to consult an attorney is not the best way for companies to deal with wage and hour claims. Instead, they should take proactive steps to avoid compliance issues. Once an employee has filed a wage and hours claim, it could already be too late to avoid penalties and reduce liability.
Here are three ways to take a proactive approach to refuting wage and hour claims.
1. Maintain good employment records (and recordkeeping practices)
Employers should seek to maintain meticulous employment records. You can do this by:
- Establishing consistent documentation policies
- Following the statutory requirements for employee records
- Following requirements for record storage, retention, and disposal
- Implementing processes for regular employee records reviews
2. Audit your records
Auditing your records also provides assurance that your business is adhering to requirements.
While businesses can perform audits on their own, the work involved can be daunting. By consulting with an experienced employment law attorney, companies can ensure that audits are done correctly and do not cause unreasonable internal burdens.
A wage and hour claims attorney can determine the laws and regulations that apply to your company and examine all aspects of your business, including relevant policies and procedures. They can also assess where your business might be exposed to compliance risks and provide recommendations for changes you can make to avoid wage and hour violations and reduce the risk of such claims.
3. Plan for the future
In addition to ensuring your business complies with all existing wage and hour laws and providing a defense when claims arise, a lawyer can help you stay informed about the law and protect your business’s future.
Having an employment law attorney on your side ensures your company is up-to-date with current labor law statutes. Employment lawyers constantly monitor regulatory changes that could impact their clients and develop strategies to ensure compliance with new laws as they arise.
Protect your business with experienced wage and hour claim attorneys
Our New Jersey employment lawyers at Dressel/Malikschmitt have extensive experience providing companies with a vigorous defense against wage and hour claims. We also work with clients to develop compliance plans that reduce the risk of claims and liability.
Our attorneys help you protect your company’s reputation and interests. Because we have worked on cases in many areas of business and corporate law matters, we are prepared to develop customized strategies to support your goals.
If you have questions about wage and hour claims or other employment law matters, contact our law firm to schedule a consultation.
The content in this article is for general informational purposes only. It should not be construed as legal advice or a substitute for legal advice. The information above does not create an attorney-client relationship, nor do prior results guarantee future outcomes. Any reliance you place on such information is therefore strictly at your own risk.