New Jersey Labor Law

December 15, 2017

Pro Football Player’s Grievance Accuses Teams of Improper Collusion

New Jersey employment statutes and other laws around the country prohibit employers from taking certain adverse actions against employees. Antitrust laws can provide relief for workers when a direct employer-employee relationship might not exist. Laws like the Sherman Act prohibit companies that ostensibly compete with one another from making agreements that impede competition. This is often known as “collusion.” Agreements among companies not to hire one another’s workers, for example, hurt workers by limiting their job opportunities. Colin Kaepernick, a professional football player who has been a controversial public figure in the past year or so, is making similar allegations in a grievance filed against the National Football League (NFL). He is a free agent, but no team has signed him since the controversy gained prominence. Rather than a lawsuit under a law like the Sherman Act, the player is alleging violations of the collective bargaining agreement (CBA) between the players’ union and the NFL. The case could have a national impact, since NFL teams are located all over the country, including two that play in New Jersey.

The Sherman Act prohibits businesses from making “contract[s]…or conspirac[ies] in restraint of trade or commerce among the several States.” 15 U.S.C. § 1. Agreements among market competitors that deliberately restrict or restrain trade, such as price-fixing, clearly violate the Sherman Act. In situations in which the alleged restraint is less obvious, courts use the “Rule of Reason” to determine whether the restriction is anti-competitive or not. Addyston Pipe & Steel Co. v. United States, 175 U.S. 211 (1899).

Agreements among NFL teams could constitute unlawful collusion under a recent U.S. Supreme Court decision. The court held that the creation of a single business entity to handle product licensing for all 32 NFL teams “constitute[d] concerted action that is not categorically beyond the coverage of §1.” American Needle, Inc. v. National Football League, 560 U.S. 183 (2010). It held that courts should apply the Rule of Reason to determine whether such agreements violate antitrust law. While that case dealt with intellectual property, it established that NFL teams are distinct entities that might have distinct economic interests.

November 16, 2017

Court Ruling on Medical Marijuana Could Affect New Jersey Disability Discrimination Law

by Resnick Law Group, P.C.

In 2009, the New Jersey Legislature authorized the possession and use of small amounts of marijuana for medical purposes with a doctor’s prescription. Federal law, however, still classifies marijuana as a controlled substance with no recognized medical use. This has led to considerable uncertainty in the area of employment law, such as whether states that allow medical marijuana use also protect workers against discrimination based on drug use that, while legal under state law, still violates federal law. So far, no New Jersey court has found that state antidiscrimination law covers lawful medical marijuana use, but at least one such claim is currently pending in state court. The defendant in that lawsuit is arguing that the federal Controlled Substances Act (CSA) preempts any state laws addressing employment discrimination claims. A federal court in Connecticut recently rejected a similar argument in Noffsinger v. SSC Niantic Operation Company, No. 3:16-cv-01938, ruling (D. Conn., Aug. 8, 2017). While this ruling does not directly affect New Jersey courts, it could have an impact on future cases.

The New Jersey Compassionate Use Medical Marijuana Act (NJCUMMA), N.J. Rev. Stat. § 24:6I-1 et seq., establishes procedures for medical professionals to prescribe marijuana. It also exempts qualifying medical professionals and their patients from liability under the state’s criminal and civil laws dealing with marijuana. Id. at §§ 2C:35-18, 24:6I-6. It does not specifically mention employment. A pair of bills introduced in the New Jersey Legislature, A2482 and S2161, would add specific employment protections for medical marijuana patients, but they have never received hearings.

Under the Supremacy Clause of the U.S. Constitution, federal law generally takes precedence over conflicting state laws. The CSA’s classification of marijuana as a Schedule I controlled substance, 21 U.S.C. § 812(c)(I)(c)(10), has caused much confusion in this regard. Preemption by federal law is a major part of the defendant’s argument in a lawsuit filed by a medical marijuana patient alleging violations of the New Jersey Law Against Discrimination (NJLAD). Wild v. Carriage Services, No. L-000687-17, complaint (N.J. Super. Ct., Bergen Cty., Jan. 30, 2017). In a motion to dismiss filed in February 2017, the defendant in Wild argues that the NJCUMMA directly conflicts with the CSA. Courts have dismissed several similar lawsuits recently on procedural grounds that do not address the merits of the medical marijuana claims. See Barrett v. Robert Half Corp., No. 2:15-cv-06245, order (D.N.J., Feb. 21, 2017); Wiltshire v. Breunig, et al, No. L-000052-16, complaint (N.J. Super. Ct., Cape May Cty., Feb. 5, 2016).

November 10, 2017

The Rights of Unpaid Volunteers and Interns in New Jersey Employment Law

by Resnick Law Group, P.C.

New Jersey employment laws protect workers’ rights in multiple areas, including wages and hours of work, discrimination and harassment, and retaliation for reporting suspected wrongdoing by an employer. Many of these laws apply specifically to “employees,” but no single definition of “employee” exists. Some statutes only cover paid employees, while others also apply to independent contractors, unpaid interns, or volunteers. The legal status of unpaid workers, including both interns and volunteers, has been the subject of multiple court battles. The New Jersey Appellate Division recently held that the state’s whistleblower statute, the Conscientious Employee Protection Act (CEPA), does not apply to unpaid volunteers. Sauter v. Colts Neck Volunteer Fire Co. No. 2, No. A-0354-15T1, slip op. (N.J. App., Sep. 13, 2017). In light of this decision, it is worth reviewing how various employment statutes in New Jersey view unpaid volunteers and interns.

“Volunteer” Versus “Intern”

Some laws make a distinction between volunteers and interns. Generally speaking, an internship provides some form of educational benefit to the worker, possibly including course credit at an educational institution, and it may be paid or unpaid. Even when an internship is unpaid, the worker is considered to gain an educational benefit. A volunteer position, on the other hand, is usually undertaken for primarily altruistic reasons, or at least without the expectation of any specific return.

October 20, 2017

Third Circuit Rules on Legality of Mass Layoffs After Failed Sale of Company

by Resnick Law Group, P.C.

A person’s job can be one of the most important features of their identity. When two people meet for the first time, for example, one of the first questions asked is very often “What do you do?” One’s job serves other purposes, such as the obvious purpose of providing income to support oneself and one’s family. Finding a job is important, but losing a job can be devastating. New Jersey labor laws protect workers in many aspects of the employer/employee relationship, including limiting the ability of some employers to fire numerous employees all at once. Laws like the Worker Adjustment and Retraining Notification (WARN) Act of 1988 apply to large employers that are planning a mass layoff of employees. The Third Circuit Court of Appeals recently ruled on a claim brought under the WARN Act involving a company that had been sold as part of a bankruptcy case. In re AE Liquidation, Inc., No. 16-2203, slip op. (3rd Cir., Apr. 4, 2017).The WARN Act applies to businesses with at least 100 full-time employees. 29 U.S.C. § 2101(a)(1). Covered employers must provide advance notice to employees prior to a “mass layoff.” The statute defines a “mass layoff” as the termination of a large number of employees within a 30-day period that is not related to a plant closing. For the WARN Act to apply, the layoff must affect either (1) at least 50 full-time workers, who constitute at least one-third of the total full-time workforce; or (2) at least 500 full-time employees. Id. at § 2101(a)(3).

An employer must provide at least 60 days’ notice to “affected employees” before undertaking a plant closing or mass layoff. Id. at § 2102(a). Aggrieved employees may recover damages for violations that include up to 60 days of back pay. Id. at § 2104. New Jersey has a similar law that requires additional disclosures from employers and allows claims for compensatory damages. N.J. Rev. Stat. §§ 34:21-3, 34:21-6.

The plaintiffs in AE Liquidation were employees of an aviation company that declared bankruptcy in November 2008. The employer planned a sale of the business as a going concern, providing “almost daily assurances that the funding was imminent and the company could be saved.” AE Liquidation, slip op. at 4. The sale fell through due to lack of funding, and the plaintiffs were laid off in February 2009. The plaintiffs filed suit under the WARN Act.

September 12, 2017

Jury Awards $11.8 Million to Former Employee in New Jersey Disability Discrimination Case

by Resnick Law Group, P.C.

New Jersey employees are protected against discrimination under federal and state laws, as well as municipal anti-discrimination ordinances in many cities around the state. The New Jersey Law Against Discrimination (NJLAD) covers a broad range of protected categories, including disability. In addition to prohibiting discrimination based on an employee’s disability, the law also requires employers to provide reasonable accommodations for employees with disabilities. A jury recently found in favor of a former corrections officer in a New Jersey disability discrimination lawsuit, awarding her about $11.8 million in damages. Pritchett v. State of New Jersey, No. L-002189-13, complaint (N.J. Super. Ct., Mercer Cty., Oct. 10, 2013).

Under the NJLAD, an employer cannot discriminate against a worker “because such person is or has been at any time disabled.” N.J. Rev. Stat. §§ 10:5-4.1, 10:5-12. This applies to people with disabilities and people who are “perceived as having a disability.” Victor v. State, 4 A.3d 126, 142 (N.J. 2010). The NJLAD’s definition of a “disability” is also “significantly broader” than that of the federal Americans with Disabilities Act. Id. at 142 n. 11. Exceptions apply when a particular person’s particular disability “would prevent such person from performing a particular job.” N.J. Rev. Stat. § 10:5-29.1; Raspa v. Office of Sheriff, 924 A.2d 435, 442-43 (N.J. 2007).

The NJLAD also requires employers to make reasonable accommodations for employees with disabilities, provided this does not “impose an undue hardship on the operation of its business.” N.J.A.C. 13:13-2.5(b). Reasonable accommodations might include modifications of facilities and equipment for accessibility, flexible or modified work schedules, or reassignment of certain job duties. Factors employers may consider when determining whether something constitutes an undue burden include the nature of their business, the size of their operation and facilities, and the potential cost of the accommodations.

August 18, 2017

New Jersey Appellate Court Clarifies Important Definition of “Misconduct” by Employees

by Resnick Law Group, P.C.

New Jersey employment laws protect the rights of employees in a wide range of areas, including workers’ right to unemployment compensation, subject to various conditions. State agencies and the courts are charged with ensuring that employers and the state fairly apply the rules regarding eligibility for unemployment compensation. The New Jersey Superior Court, Appellate Division, recently invalidated part of a rule adopted by the state’s Department of Labor and Workforce Development (LWD). The challenged rule defined “misconduct,” in the context of unemployment, in a way that the court found “arbitrary and capricious.” In re N.J.A.C. 12:17-2.1, No. A-4636-14T3, slip op. at 3 (N.J. App., May 1, 2017). A consistent definition of “simple misconduct,” the court held, is required to protect workers’ rights.

The New Jersey Unemployment Compensation Law (UCL) states that eligible individuals shall receive benefits for a set period of time after they become “unemployed,” within the meaning established by the statute. See N.J. Rev. Stat. §§ 43:21-3, 43:21-19(m)(1). Benefits are paid from an unemployment insurance program funded by payroll tax deductions and employer contributions. In order to obtain benefits, an individual must file a claim with LWD. See N.J. Rev. Stat. §§ 43:21-4, 43:21-6.

An individual may be disqualified from eligibility for unemployment benefits if they were “suspended or discharged for misconduct” by their previous employer. Id. at § 43:21-5(b). The employer has the opportunity to respond to a former employee’s unemployment claim, including with allegations of misconduct. The statute identifies three levels of “misconduct”: simple, severe, and gross misconduct. The challenged LWD rule, codified at N.J.A.C. 12:17-2.1, defines the three levels of misconduct.

May 2, 2017

New Jersey Antitrust Class Action Accuses Employers of “Anti-Poaching” Agreements

by Resnick Law Group, P.C.

In 2015, a group of technology companies settled a class action filed on behalf of thousands of employees for about $415 million. The lawsuit alleged that the defendants violated antitrust laws by entering into “anti-poaching” agreements, by which they agreed not to solicit or hire each other’s employees. These types of agreements make it difficult, if not impossible, for workers to advance in their fields, and they also tend to drive wages downward. More recently, a putative class action that partly originated in New Jersey made similar allegations against two major electronics companies. Frost v. LG Corp., et al., No. 5:16-cv-05206, complaint (N.D. Cal., Nov. 8, 2016). A judge granted the defendants’ motion to dismiss the case in April 2017, based on pleading defects, but will allow the plaintiffs to make corrections in an amended complaint. The case remains a good example of how state and federal antitrust laws can affect employment.

The main federal antitrust statute is the Sherman Act, originally enacted by Congress in 1890 in an effort to address monopolistic practices across the country. It prohibits any “contract…in restraint of trade or commerce among the several states,” 15 U.S.C. § 1, and allows both civil and criminal penalties. The New Jersey Antitrust Act uses almost identical language to describe prohibited contracts. N.J. Rev. Stat. § 56:9-3. The attorneys general at the state and federal levels are empowered to investigate and prosecute anticompetitive practices, and both state and federal laws allow civil causes of action by aggrieved parties.

The Frost lawsuit is actually a consolidation of two lawsuits filed in California and New Jersey. It asserts claims on behalf of three classes of employees: nationwide, in California, and in New Jersey. The two defendant employers are American subsidiaries of South Korean companies. Their parent companies are also named as defendants. The lead plaintiff for the New Jersey class worked for one of the defendants in Englewood Cliffs for about eight years, beginning in 2006.

April 14, 2017

New Jersey Law Requires Employers to Give Specific Notification to Employees During Layoffs and Other Major Upheavals

by Resnick Law Group, P.C.

According to some analysts, New Jersey is experiencing a net loss of residents and businesses, which means it is also losing jobs. When a business decides to cease operations in an entire state, a significant amount of job loss is probably inevitable, but the state has enacted laws that offer some protection to workers in this type of situation. The NJ WARN Act, more officially known as the Millville Dallas Airmotive Plant Job Loss Notification Act of 2007, establishes procedures that many businesses must follow when they take certain actions that result in major job loss. This includes a detailed notification that must be provided to each affected worker. Employers that fail to provide the required notification may be liable for damages to their employees.

The NJ WARN Act generally applies to businesses that have operated in New Jersey for at least three years and that have 100 or more full-time employees. Their obligations under the statute are triggered by certain events, including a “mass layoff,” a “transfer of operations,” and a “termination of operations.” N.J. Rev. Stat. § 34:21-1. The statute defines a “mass layoff” as a “reduction in force” that is not related to a transfer or termination of operations and that results in the termination of (1) at least 500 employees within a 30-day period, or (2) at least 50 employees when that number represents at least one-third of the company’s total full-time workforce. Id. A termination of operations occurs when the company voluntarily closes an entire facility, either permanently or temporarily. A transfer of operations involves moving a facility to another location.

If an employer conducts a mass layoff or a transfer or termination of operations that causes equivalent job loss, the NJ WARN Act requires it to provide a notification to each affected employee, along with severance pay “equal to one week of pay for each full year of employment.” Id. at § 34:21-2(b). The notification must state the number of employees losing jobs, an explanation of why the employer is undertaking these actions, a breakdown of the severance pay, statements of the employee’s legal rights, and information about comparable jobs available with the employer. Id. at § 34:21-3.

April 5, 2017

Supreme Court to Consider Whether Class Action Waivers Are Enforceable in Employment Disputes

by Resnick Law Group, P.C.

The U.S. Supreme Court granted certiorari to three consolidated cases addressing the enforceability of class action and collective action waivers in employment arbitration agreements. Many employment agreements include provisions stating that both employees and employers will submit any employment-related dispute to a neutral arbitrator. A waiver bars employees from filing or joining a class action related to their employment. The Federal Arbitration Act (FAA), 9 U.S.C. § 1 et seq., appears to authorize this type of provision, but a waiver might violate the National Labor Relations Act, 29 U.S.C. § 151 et seq. The Supreme Court has recently upheld class action waivers in consumer contracts, and it may have agreed to hear this case in order to resolve any uncertainty resulting from those rulings.

In a class action, a plaintiff or group of plaintiffs sues on behalf of a larger group of similarly situated persons. This allows people who lack the resources to file suit, or whose individual claims are too small to justify the expense of suing, to pool their claims into a single lawsuit. Federal law establishes four criteria for certifying a class: (1) the class must be numerous enough to make individual lawsuits, or individual joinder of plaintiffs, impractical; (2) the class members must have common legal or factual questions; (3) the claims of the lead plaintiffs must be typical of the other class members; and (4) the lead plaintiffs must be able to “fairly and adequately” represent the class members and their interests. Fed. R. Civ. P. 23(a).

Arbitration is a method of alternative dispute resolution. Instead of filing suit, the parties submit their dispute to one or more arbitrators, who are usually legal professionals with knowledge of the subject matter at issue. The arbitrator will conduct a hearing, which might resemble a trial in many ways, and recommend an outcome. Employment contracts may require binding or non-binding arbitration. The results of binding arbitration are not subject to review by a court, absent evidence of misconduct by the arbitrator. A common criticism of arbitration is that the process tends to favor whomever is paying the arbitrator’s fees.

March 24, 2017

Do Employees Who Join National Strikes Have Legal Protection Against Getting Fired?

by Resnick Law Group, P.C.

The past few months have seen numerous high-profile protests around the country, both in opposition to and support of the new administration in the White House. At least two major protests have called for nationwide strikes or walkouts. In February 2017, A Day Without Immigrants called attention to the significant role of immigrants in the nation’s workforce. This month, A Day Without a Woman did the same with regard to women in the workplace. Similar protests have occurred in this country and in countries around the world for many reasons across the political spectrum. It is not clear how many people participated in the recent events, but they appeared to have a noticeable impact. They also resulted in some participants losing their jobs specifically because of their participation, which raises the question of whether, and to what extent, state and federal employment laws protect this sort of activity. A quick review of a few statutes shows that no simple answer exists. For any individual, the answer may depend on their particular employer’s policies.

Antidiscrimination laws, like Title VII of the Civil Rights Act of 1964 and the New Jersey Law Against Discrimination (NJLAD), protect employees from adverse actions by their employers based on specified categories, such as race, sex, and national origin. The NJLAD provides much broader protections than Title VII, but neither specifically addresses political views or activities. An employer who terminates or otherwise penalizes an employee for participating in a strike like the ones mentioned above might not violate state or federal antidiscrimination laws. A claim could hypothetically be possible if the employer’s actions indicate bias based on a protected category. The two recent strikes deal specifically with the protected categories of national origin and sex. This sort of claim would probably be a long-shot without solid evidence of an employer’s bias, but it is a possibility.

Laws protecting employees’ right to engage in labor activities are likely to be a better option, but the amount of protection they offer is also not clear. The National Labor Relations Act (NLRA) states that workers have the right to engage in “concerted activities” aimed at collective bargaining or “mutual aid or protection.” 29 U.S.C. § 157. Employers may not unreasonably interfere with employees who are exercising these rights, nor may they discriminate against employees who do so. It would be hard to make the case that events like A Day Without Immigrants have collective bargaining as their ultimate goal, but they do plausibly serve the purpose of “mutual aid or protection” for workers.
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