The New Jersey Employment Law Firm Blog

November 9, 2018

Lawsuit Alleges Video Game Company Violated Federal and State Labor Laws by Laying Off Most of Its Employees

New Jersey employment laws, as well as laws around the country, must balance the rights and interests of employees with those of employers. Employees’ protected rights include fair wages, reasonable hours, and a workplace that is reasonably safe and free of harassment and discrimination. Employers need to be able to pursue their business activities, to the extent that they do not violate the rights of their employees and others. Sometimes, businesses may determine that they need to lay off a significant portion of their workforce. This is within an employer’s rights, but laws at the federal level and in many states, including New Jersey, set strict limits. A recently-filed lawsuit alleges that a video game company violated the federal Worker Adjustment and Retraining Notification (WARN) Act of 1988 when it laid off all but twenty-five employees several months ago. Roberts, et al v. Telltale Games, Inc., No. 3:18-cv-05850, complaint (N.D. Cal., Sep. 24, 2018).

The federal WARN Act generally applies to employers with at least one hundred full-time employees. The statute’s requirements are triggered by two events: a “plant closing” or a “mass layoff.” The former refers to any closure of a facility that results in fifty or more employees at a single site losing their jobs within a period of thirty days; while the latter refers to any other incident that, in a thirty-day period, results in layoffs of (1) at least five hundred employees, or (2) at least fifty employees when that number accounts for one-third of all employees. 29 U.S.C. §§ 2101(a)(2), (3). New Jersey’s equivalent law is formally known as the Millville Dallas Airmotive Plant Job Loss Notification Act of 2007, and informally known as the NJ WARN Act. It uses the same definition of “mass layoff,” and uses the term “termination of operations” to refer to the same type of incident as a “plant closing.” N.J. Rev. Stat. § 34:21-1.

Both the federal and NJ WARN Acts require covered employers to provide written notice to employees or their representatives at least sixty days prior to a plant closing or mass layoff. 29 U.S.C. § 2102(a)(1), N.J. Rev. Stat. § 34:21-2(a). If an employer fails to provide the required notice under either statute, aggrieved employees may bring a civil action for damages. Federal law allows back pay, along with benefits subject to the Employee Retirement Income Security Act of 1974 (ERISA), for up to sixty days. 29 U.S.C. § 2104(a). The NJ WARN Act allows courts to award “lost wages, benefits and other remuneration” in an amount up to “one week of pay for each full year of employment.” N.J. Rev. Stat. §§ 34:21-2(b), 34:21-6.
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November 2, 2018

New Jersey’s New Public-Sector Union Law Faces Challenge in Light of Recent Supreme Court Ruling

by Resnick Law Group, P.C.

A new law protecting New Jersey public sector unions, which was signed into law by Governor Phil Murphy in May 2018, faces a legal challenge based on a U.S. Supreme Court decision one month later. The law, entitled the Workplace Democracy Enhancement Act (WDEA), establishes standards for interactions between public-sector unions and government employers, and addresses several controversial issues. The Supreme Court’s ruling in Janus v. AFSCME, 585 U.S. ___ (2018), however, could represent a significant reduction in the power of public-sector unions. A lawsuit filed by several union members against their union and various state government officials argues that Janus invalidates certain provisions of the WDEA. Thulen, et al v. AFSCME, et al, No. 1:18-cv-14584, complaint (D.N.J., Oct. 3, 2018). The lawsuit is among the first to test how Janus will impact New Jersey employees’ rights.

Federal and state laws protect workers’ rights to organize for the purpose of collective bargaining, and either to form a union or to join an existing union that can negotiate with management on their behalf. The WDEA declares that any public sector union chosen as “the exclusive representatives of employees in a collective negotiations unit” must “hav[e] access to and be[] able to communicate with the employees it represents.” P.L. 2018, c. 15 § 2 (N.J. Rev. Stat. § 34:13A-5.12). The law requires public employers to allow union representatives to have reasonable access to employees, and to provide certain employee information to the union within a specified time frame.

Public-sector union members may authorize their employer to deduct union membership dues from their paychecks. The WDEA provision at issue in Thulen involves a restriction on employees’ ability to withdraw authorization for this payroll deduction. An employee may only withdraw authorization by giving written notice to the employer “during the 10 days following each anniversary date of their employment.” Id. at § 6, amending N.J. Rev. Stat. § 52:14-15.9e.

October 26, 2018

Supreme Court Ruling Strikes Down Fees Charged to Non-Members by Public Sector Unions

by Resnick Law Group, P.C.

The role of labor unions in the modern economy is often a controversial issue. It is exceedingly difficult to deny, however, that they have improved working conditions for employees in New Jersey and around the country. Today’s unions are arguably victims of their own success, as many people no longer see them as necessary. Workers nevertheless still benefit from the ability to bargain collectively with their employers. Federal and state laws protect workers’ ability to organize for purposes of collective bargaining, but many states have enacted laws that limit unions in important ways. A recent decision by the U.S. Supreme Court, Janus v. AFSCME, 585 U.S. ___ (2018), specifically impacts public sector unions and their ability to collect fees to support their collective bargaining activities. If you have a question about your union, contact a New Jersey labor law attorney.

The National Labor Relations Act (NLRA) of 1935 allows workers to organize in order to engage in collective bargaining with their employer regarding pay, working conditions, and other features of employment. See 29 U.S.C. § 157. Union members support these activities by paying membership fees. Workers who do not become dues-paying members often still benefit from the union’s efforts. This is commonly known as the “free rider problem.” Some unions dealt with this by negotiating “closed shop” agreements, by which the employer could only hire union members; or “union shop” agreements, which required all employees to join the union or pay an “agency fee” once they had been hired.

The Taft-Hartley Act of 1947 banned closed shop agreements, and only allowed union shop agreements or agency fees to the extent that they do not conflict with state law. Id. at § 164(b). Many states have enacted “right to work” laws, which prohibit unions from charging agency fees to non-members.
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October 19, 2018

Federal Lawsuit Alleges Gender Discrimination Under the Equal Pay Act

by Resnick Law Group, P.C.

Federal and state law prohibit employment discrimination on the basis of sex, particularly with regard to salary and wages. New Jersey’s newly-enacted Diane B. Allen Equal Pay Act (DAEPA) is one of the most comprehensive laws in the country addressing wage disparities based on sex. The federal Equal Pay Act (EPA), while offering fewer protections, applies more broadly throughout the country. Both statutes allow employees to file suit and recover damages for wage discrimination. A lawsuit that is currently pending in a federal court alleges a widespread pattern of sex discrimination in wages and other features of employment. Cahill et al v. Nike, Inc., No. 3:18-cv-01477, complaint (D. Ore., Aug. 9, 2018). Although the case is filed in Oregon, where the defendant maintains in main headquarters, it could also affect workers in New Jersey and New York. The defendant has a significant presence in this part of the country, and recently opened a regional headquarters in New York City. If you have questions regarding possible instances of discrimination at your workplace, contact a New Jersey employment discrimination attorney to discuss.

The federal EPA was enacted as an amendment to the Fair Labor Standards Act (FLSA). It prohibits employers who are covered by the FLSA from paying workers of different genders at different rates “for equal work on jobs” that “require[] equal skill, effort, and responsibility, and which are performed under similar working conditions.” 29 U.S.C. § 206(d)(1). Employers are not liable for wage disparities resulting from systems that are based on “seniority,” “merit,” “quantity or quality of production,” or “any other factor other than sex.” Id. Employees alleging wage discrimination based on sex are subject to a two-year statute of limitations.

New Jersey’s DAEPA, which took effect in July 2018, includes the same exceptions as the EPA for systems based on seniority, merit, etc., but it goes into more detail about these exceptions. Any differential in pay must be based on “legitimate, bona fide factors other than the characteristics of members of the protected class.” N.J. Rev. Stat. § 10:5-12(t)(1), as amended. Employees have six years to file suit for alleged violations.
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October 15, 2018

How the “Gig Economy” Could Impact Wage and Hour Law Claims in New Jersey

by Resnick Law Group, P.C.

The term “gig economy” has entered common usage in recent years. It broadly refers to alternatives, of sorts, to having a single 9-to-5 employer. This includes rideshare or delivery services, and services ranging from childcare to odd jobs through online platforms. It also includes selling goods through online marketplaces, and most kinds of freelance work. One supposed advantage of the gig economy is that it provides greater flexibility for workers than the traditional workplace. It also comes with certain disadvantages, including a lack of legal protections when compared to the traditional definition of “employment.” This summer, the New York Times reported on several studies examining the gig economy. While most of the workforce still holds traditional jobs, the gig economy is growing. The studies provide nationwide information, not figures on employment in New Jersey or any other specific state. As this type of work arrangement becomes more common, our system of employment laws may have to catch up. Speak to a New Jersey employment lawyer to discuss any questions you might have.

Minimum wage and overtime laws are among workers’ most important legal protections, but state and federal laws only apply to people who meet a specific definition of an “employee.” The federal Fair Labor Standards Act (FLSA) establishes a national minimum wage, overtime requirements, and limits on child labor. Its definition of an “employee” is simply “any individual employed by an employer.” 29 U.S.C. § 203(e)(1). Gig economy workers are often considered to be independent contractors instead of employees, for FLSA purposes. The extent to which the FLSA’s minimum wage and overtime requirements apply to gig economy workers is a matter of ongoing dispute, with courts deciding cases in both directions and the U.S. Department of Labor (DOL) recently changing its position on the issue.

New Jersey’s Wage Payment Law expressly states that it only applies to “employees,” which it defines as “any person suffered or permitted to work by an employer.” N.J. Rev. Stat. § 34:11-4.1. The statute specifically excludes independent contractors from that definition. The state’s Wage and Hour Law has a similar definition of “employee,” but without the specific exclusion of independent contractors. Id. at § 34:11-56a1(h). State regulations establish a test for determining whether an employee has been misclassified as an independent contractor. N.J.A.C. § 12:56-16.1. See also Hargrove v. Sleepy’s, LLC, 106 A.3d 449 (N.J. 2015).
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October 4, 2018

FTC Settles Case Alleging Collusion Among Employers to Keep Pay Rates Low

by Resnick Law Group, P.C.

Federal law prohibits employers from engaging in practices that have an adverse effect on competition. This includes practices that harm consumers and those that harm employees. For example, employers engaged in the same business, who would ordinarily compete among each other for employees, may not enter into agreements with one another that diminish employment opportunities or set artificial limits on wages. Agreements not to solicit or hire one another’s employees, for example, can prevent those employees from advancing in their chosen careers. Agreements on wage limits impact employees’ ability to negotiate higher wages. The Federal Trade Commission (FTC), which enforces various federal consumer laws, may also investigate anticompetitive practices. It recently announced a settlement with a group of staffing companies, which it alleged violated federal law by colluding to limit pay rates. In the Matter of Your Therapy Source, LLC, et al, No. C-1710134, complaint (FTC, Jul. 31, 2018). Although the case did not involve events in New Jersey, federal antitrust and anticompetition laws have nationwide application. A New Jersey employment law attorney can help guide you in the right direction based on the unique facts of your situation.

The FTC was created by the Federal Trade Commission Act (FTCA) of 1914, 15 U.S.C. § 41 et seq. The statute prohibits “unfair methods of competition in or affecting commerce,” and authorizes the FTC “to prevent persons, partnerships, or corporations…from using unfair methods of competition in or affecting commerce.” Id. at §§ 45(a)(1), (2). It also specifically states that a finding of liability under the FTC Act does not preclude additional findings of liability under other antitrust statutes, such as the Sherman Antitrust Act of 1890. Id. at §§ 44, 45(e).

The respondents in the Your Therapy Source case operated staffing services that, according to the FTC’s complaint, provided therapists to “treat[] home health agency patients in the Dallas/Fort Worth, Texas area.” Your Therapy Source, complaint at 1. Although the companies competed with one another in the same market, the FTC alleged that they “agree[d], and invit[ed] other therapist staffing companies to agree, on rates paid to therapists.” Id. Ordinarily, therapists could “contract with multiple therapist staffing companies and choose among them based on pay rate” and other factors. Id. at 3. The agreement alleged by the FTC, however, prevented therapists from obtaining competitive pay rates.
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September 28, 2018

NLRB Considers Revisiting 2014 Ruling Regarding Employer Restrictions on Use of Company Email by Employees in New Jersey and Nationwide

by Resnick Law Group, P.C.

The National Labor Relations Act (NLRA) protects workers’ rights to engage in activities related to labor organizing. The statute established the National Labor Relations Board (NLRB) to investigate and adjudicate alleged violations. Union organizing can now take place both online and in real life, and the NLRB regularly considers questions involving communications technologies like email. Its rulings can affect not just New Jersey employment law but workers in New Jersey and all over the country. In 2007, the NLRB ruled that employers can place restrictions on employees’ use of company email for non-work purposes, even if it might restrict employees’ ability to engage in NLRA-protected activities. It overturned that decision in 2014, but now the NLRB is asking the public to file briefs addressing whether it should return to the standard it established in 2007.

Section 7 identifies workers’ “right to self-organization,” and to engage in activities related to “bargain[ing] collectively through representatives of their own choosing.” 29 U.S.C. § 157. An employer commits an “unfair labor practice” under § 8 of the NLRA if it “interfere[s] with, restrain[s], or coerce[s]” an employee attempting to exercise a protected right. Id. at § 158(a)(1). Congress enacted the NLRA in 1935, and it last amended § 7 in 1947. The nature of union organizing has changed in many ways since that time, and the job of interpreting § 7 in light of new technologies has largely fallen on the NLRB.

In 2007, the NLRB ruled that “employees have no statutory right to use the [employer’s] e-mail system for Section 7 purposes.” The Guard Publishing Co. d/b/a The Register-Guard, et al, 351 NLRB 1110 (2007). The employer in that case, a newspaper, installed a computer system in 1996 that provided email accounts for many of the employees. It maintained a policy prohibiting employees from using their email accounts for “non-job-related solicitations.” Id. at 1111. An employee alleged violations of § 7 after the employer issued several written warnings to her about using her company email account to send notices about union activities. The NLRB affirmed an administrative law judge’s (ALJ’s) 2002 ruling that the employer’s policy did not violate § 8, but that the employer violated § 8 by enforcing the policy in a discriminatory manner.
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September 20, 2018

Equal Pay Law Takes Effect in New Jersey

by Resnick Law Group, P.C.

A new law, entitled the Diane B. Allen Equal Pay Act (DAEPA), went into effect in New Jersey on July 1, 2018. Described by the media as “the strongest equal pay law in America,” the law amends the New Jersey Law Against Discrimination (NJLAD) to address disparities in pay based on all protected categories. If a covered business pays workers at different rates, it must justify the difference based on factors like education or experience. The state recently issued reporting forms for businesses that enter into certain contracts with the state, which they must submit to the New Jersey Department of Labor and Workforce Development.

The federal Equal Pay Act (EPA) of 1963 prohibits paying employees at different rates “on the basis of sex” in jobs that “require[] equal skill, effort, and responsibility, and…are performed under similar working conditions.” 29 U.S.C. § 206(d)(1). The statute allows exceptions where the disparity is based on seniority, merit, “quantity or quality of production,” or other non-sex-based factors. Id. The EPA amended the Fair Labor Standards Act (FLSA), and allows complainants to recover damages through the same process for minimum wage and overtime violations. Id. at § 206(d)(3). The law has a two-year statute of limitations, meaning that complainants cannot recover damages for more than two years of New Jersey equal pay violations. Id. at §§ 216(c), 255(a).

The DAEPA was introduced in the New Jersey Legislature as Senate Bill 104 on January 9, 2018, and as Assembly Bill 1 on March 22. It passed both houses on March 26, and was signed into law by the governor on April 24, with an effective date of July 1. According to media analyses of federal labor statistics, female workers are paid eighty-two cents for every dollar paid to male workers in New Jersey. This number includes all women throughout the state. For women of color, the pay disparity is much greater. The DAEPA goes further than equal pay statutes that focus on sex or gender. It prohibits pay discrimination on the basis of any protected class identified by the NJLAD, such as race, religion, nationality, sexual orientation, etc.
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September 14, 2018

NLRB Rules Against Employer’s Ban on Solicitation

by Resnick Law Group, P.C.

New Jersey labor laws protect the rights of workers to organize for the purpose of collectively asserting their workplace rights, such as by forming a union to engage in collective bargaining with their employer’s management. At the federal level, the National Labor Relations Act (NLRA) protects a wide range of activities related to organizing, and prohibits employers from interfering with employees in the exercise of those rights. The National Labor Relations Board (NLRB) is charged with investigating and, in some cases, issuing rulings on alleged violations of the NLRA. An ongoing issue of dispute between employers and employees is the extent to which employers can bar their employees from engaging in organizing activities on the employer’s property. The NLRB recently ruled that an employer’s ban on solicitation on company property was an unfair labor practice under the NLRA. UPMC, 366 NLRB No. 142 (2018).

Section 7 of the NLRA protects workers’ “right to self-organization,” which includes the right “to form, join, or assist labor organizations.” 29 U.S.C. § 157. It is an “unfair labor practice” for employers “to interfere with [or] restrain…employees in the exercise of the rights guaranteed in” Section 7. Id. at § 158(a)(1). Employees may file complaints alleging unfair labor practices with the NLRB.

The NLRB’s website states the agency’s position regarding employees’ solicitation of their fellow employees for union membership: “Working time is for work.” Employers, according to the NLRB, are permitted to “maintain and enforce non-discriminatory rules limiting solicitation and distribution,” but they cannot prohibit such activity “during non-work time, such as before or after work or during break times.” It bases this position on U.S. Supreme Court decisions affirming the right to engage in solicitation outside of work hours. The UPMC case involves businesses providing healthcare services. The Supreme Court has ruled that “health care facilities [must] permit employee solicitation and distribution during nonworking time in nonworking areas,” provided that the employer has not shown that such activities cause “disruption of health care operations or disturbance of patients.” Beth Israel Hospital v. NLRB, 437 U.S. 483, 507 (1978).

September 4, 2018

New Jersey Continues to Reject “Right to Work” Laws

by Resnick Law Group, P.C.

Organized labor, usually in the form of labor unions, is responsible for countless improvements in working conditions in New Jersey and throughout the country. The first half of the twentieth century saw the most improvements, as unions and their members fought—often literally—for reasonable hours, workplace safety, and better pay and benefits. Union membership has declined significantly in the past fifty years, however. One reason is a well-organized campaign that advocates for laws limiting the influence of unions in the workplace. These laws often go by the rather Orwellian name “right-to-work.” Voters in Missouri recently rejected a right-to-work law enacted by the state legislature and signed by the governor. Still, at least twenty-seven states have enacted right-to-work laws. New Jersey remains very favorable towards unions, with both laws and court decisions that affirm unions’ importance to the modern workplace.

Unions are able to negotiate on behalf of workers through collective bargaining agreements (CBAs) between a union and an employer. In order to understand how right-to-work laws affect unions’ ability to negotiate effectively, it is important to understand how unions have sought to ensure that they are able to speak for as many workers as possible. Some CBAs have, in the past, created “closed shops,” which means that employers could only hire union members. A “union shop” refers to an employer that, under the terms of a CBA, must require employees to join the union as a condition of employment.

One of the main objections to these types of arrangements involves the obligation of workers to join a union and pay dues, even if they do not agree with the union’s positions on various issues. The counter-argument to this is that all employees of a particular employer are likely to benefit from a union’s work, including those who are not members of the union. This is known as the “free rider problem.” Some union-shop CBAs, rather than requiring all employees to join the union, require workers who do not want to join to pay an “agency fee.”
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