KEY TAKEAWAYS:
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The New Jersey Pay Transparency Act will be widely applied and includes employers who employ individuals in the state, do business in the state, or even take applications for employment within the state
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The act applies to internal and external job postings, for new jobs as well as promotion and transfer opportunities (with narrow exceptions)
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Multistate employers should be mindful of the growing number of states that have adopted pay transparency laws
As of June 1, New Jersey will join a growing number of states requiring pay transparency in job postings. The Pay Transparency Act that New Jersey Gov. Phil Murphy signed into law mandates employers post internal and external job postings, including wage or salary ranges and benefits.
The act applies to all employers with at least 10 employees over 20 calendar weeks that do business within the state, employ at least one person in the state, or even simply take applications for employment within the state of New Jersey. The act does not specify whether the 10-employee minimum includes employees located outside of New Jersey. Job placement and referral agencies and other employment agencies are also expressly covered by the act.
The notification requirements of the act apply to internal and external positions available for promotion, transfer opportunities, and new jobs, except when a promotion for a current employee is awarded based on years of experience or performance. The word promotion is defined as “a change in job title and an increase in compensation.” The act also provides that employers are not prohibited from promoting a current employee on an emergent basis due to an unforeseen event. However, the act does not provide any definition or guidance on what might qualify as an “emergent basis” or an “unforeseen event” to trigger this narrow exception.
The act requires all covered employers to disclose the hourly wage or salary, or a range of the hourly wage or salary that it would consider for the available position. While these ranges set a baseline, the act permits employers to offer higher compensation at the time of hire. The act also requires the job posting to include a general description of all benefits and other compensation programs for which the applicant would be eligible.
Any employer who violates the act shall be subject to a civil penalty not to exceed $300 for the first violation, and $600 for each subsequent violation, collectible by the Commission of Labor and Workforce Development in a summary proceeding. The act clarifies that an employer’s failure to comply with the act for a particular job opportunity shall be considered one violation, regardless of the number of platforms or postings that contain the same job opportunity. While the act does not contain a private cause of action, employers should be aware that an employee could also bring a Conscientious Employee Protection Act claim if they feel they have been the victim of retaliation for reporting their employer’s failure to comply with the act.
Multistate employers should be mindful that New Jersey now joins California, Colorado, Connecticut, the District of Columbia, Hawaii, Illinois, Massachusetts (goes into effect October 29), Maryland, Nevada, New York, Rhode Island, Vermont, and Washington in adopting some measure of pay transparency.
All covered employers should review and revise their job postings as necessary in anticipation of the new act going into effect on June 1. Likewise, all covered employers should contact any recruiters or third-party agencies with whom they work and who post opportunities on the employer’s behalf to ensure that they are aware of and are complying with the act.
