On January 21, 2020, Gov. Phil Murphy signed several new bills into law. These laws aim to increase protections for employees across New Jersey, but they could lead many employers to face considerable risks and challenges.
One new law increases the power of the stop-work order
One of the new laws, Assembly Bill 5838, will allow the commissioner of the Labor and Workforce Development to issue a stop-work order if they find:
- Wage violations;
- Benefits violations; or
- Employment tax law violations.
Wage and benefits violations could pose significant challenges for employers since new laws signed in 2019 recently changed the rules regarding these issues. For example:
- New Jersey’s minimum wage increased to $11 per hour as of January 1; and
- Gov. Murphy also recently signed laws that address the controversial issue of misclassification. This law requires employers to reevaluate how they classify all of their workers, or they could face serious fines.
If employers do not adhere to these new laws, they could be ordered to cease all operations until they do, which poses a great financial risk. Essentially, this law compounds the penalties that employers could face if they do not comply with the most recent employment laws.
Employers must take care to ensure they are in compliance
Violating a stop-work order could lead to a penalty of $5,000 a day. However, that is not the only risk that employers could face if they do not comply with the new laws or disregard the stop-work orders. They could also face financial penalties for the other violations that resulted in the stop-work order as well as damaging lawsuits.
Employers must mitigate these risks and potential losses before they face them. It may be beneficial to consult an experienced attorney to manage these risks effectively.