Carol Asselta, SPHR; SHRM-SCP AKziom Consulting

John Knoop, SPHR; SHRM-SCP AKziom Consulting

The presentation is NOT legal advise.

It is an interpretation of the laws & regulations

Will be subject to regulations

◦ Items found in the proposed regulations will be shown as (PR)

Still open questions that may be resolved with final regulations or future guidance.

Effective Oct. 29, 2018

Requires employers to provide a maximum of 40 hours of paid sick leave per year

Applies to ALL employers regardless of size

Applies to ALL employees, full time or part time, with 3 exceptions

Persons performing construction services pursuant to a collective bargaining agreement

Per diem healthcare workers; and

Public employees who are provided sick leave with full pay pursuant to any state law, rule or regulation

Employees covered by a collective bargaining agreement in effect at the time on the effective date of the law, no provision shall apply until the expiration of the collective bargaining agreement

Must bargain over during next contract negotiations

Employee earn 1 hour of paid sick leave for every 30 hour worked – up to 40 hours in a 12 month benefit year ◦ PR – hours worked as defined in Wage & Hour law

New employee accrue immediately but have to wait 120 (calendar) days to use

OR

Front load – (PR - advance) ◦waive the accrual

◦ grant 5 days (40 hours) at beginning of benefit year

◦ PR – no guidance on pro-rating for:

Hires during benefit year

Part timers

New employees during year – calculate eligible hours

Can utilize a current PTO policy as long as it provides equal or greater benefits ◦Must abide by other provisions of the law such as

Anti-retaliation

Non-discrimination

Recordkeeping requirements

(PB) – including usage and carryover

Benefit year – can be a calendar or fiscal year or any other 12 consecutive month period ◦ Employer decides the benefit year

◦ PR – must be the same for all employees

◦Any change in benefit year thereafter must be approved by Commissioner

Need to define in your policy

Carryover at end of benefit year – earned / unused sick leave ◦Up to 40 hours

◦Note: in no benefit year is an employer required to accrue or pay more than 40 hours of paid sick leave

OR

Employer can “offer” payment of earned / unused time ◦ In final month of benefit year

BUT

Employee can within 10 days of offer ◦ Accept payment offer

◦ Decline payment and take carry over hours (up to 40 hours)

◦ Request only 50% of payment and the balance as carryover

Employer has the option to: ◦ Pay employees in full for the amount of

unused earned sick leave in the final month of the benefit year

OR ◦ Carry forward any unused sick leave to the

next benefit year (subject to the 40 hour maximum)

Employers who use either of the above options at the end of the benefit year - Cannot use the accrual process for earned sick leave during the next benefit year

Upon termination ◦Do NOT have to pay for earned but unused sick leave (put in policy)

Upon rehire ◦ If rehired within 6 months, must give back previous unused time ◦Prior time worked counts toward meeting eligibility for use of paid sick leave (i.e. 120 days)

Diagnosis, care, treatment, or recovery related to the employee’s illness;

To care for a family member during diagnosis, care, treatment, or recovery related to a family member’s illness;

For certain absences resulting from the employee or a family member being a victim of domestic or sexual violence;

To attend school-related conferences, meetings, or events, or to attend other meetings regarding care for the employee’s child.

For time during which the employee is not able to work because of a closure of the employee’s workplace, or the school or place of care of a child of the employee, in connection with a public health emergency or a determination that the presence of the employee or child in the community would jeopardize the health of others;

child, grandchild, sibling, spouse, domestic partner, civil union partner, parent, or grandparent of an employee,

or a spouse, domestic partner, or civil union partner of a parent or grandparent of the employee

or a sibling of a spouse, domestic partner, or civil union partner of the employee,

or any other individual related by blood to the employee or whose close association with the employee is the equivalent of a family relationship

Business can establish increments in which an employee may use paid sick leave ◦ Largest increment cannot be greater than the number of hours scheduled for work on a particular shift

May want to look at your current practice of increments for vacation and other paid time off

Normal rate of pay

PR -Employee works at 2 or more different rates or is compensated at a piece rate, or pay fluctuates: ◦ Analyze the total earnings over the last 7 workdays

(exclusive of overtime premium) and divide by the total hours worked

PR – unable to provide exact hourly wage (pay may include gratuities, food/lodging) ◦ Pay using an agreed upon hourly rate but must be at

least the state minimum wage ($8.60)

PR – Employee compensated at commission basis, base wage plus commission or commission only, must pay either the hourly base wage rate or the State minimum wage, whichever is higher

Need is foreseeable – employers may require no greater than a seven day advance notice

Otherwise, must provide notice as soon as practicable

May require documentation justifying the use of paid sick leave for three or more consecutive days

Employers may prohibit employees from using earned and foreseeable sick leave on certain dates (must be in policy)

Employers can require reasonable documentation if earned and unforeseeable sick leave is used during those dates

PR – Does not indicate you have to provide specific dates in policy but must give reasonable notice ◦ recommend that you indicate you may designate

certain dates in your policy

PR - Does indicate that you must be able to show why you have defined such date(s) as black out dates (verifiable high-volume periods or special events) ◦ Such as launching of a new product ◦ Heavy customer needs due to holiday – such as

Thanksgiving for a restaurant

Need for paid sick leave us can be used if need was not foreseeable

Posting – conspicuously post notice of rights in form issued by NJDOL

Notice to employees

◦No later than 30 days after the date notification is issued

◦At the time an employee is hired

◦Upon request by an employee

Recordkeeping – MUST track sick leave hours earned and paid during each benefit year

◦Must keep for 5 years

Must keep for ALL employees – including Exempt

◦who are paid a regular weekly salary and may have variable hours worked

◦ Regulations may help with clarification

PR – exempt employees ◦ Can use a fixed 40 hours / workweek for the

number of hours worked for accrual purposes

OR

◦ Can use actual hours worked

Still have to track usage of paid sick leave ◦ Need for recordkeeping

◦ Need to calculate carry over

Employers are prohibited from retaliating for using protected leave ◦ Cannot be disciplined for using ◦ Cannot have paid sick leave counted as a violation of an

attendance policy

If you take an adverse action against an employee within 90 days of employee: ◦ Filing a complaint alleging discrimination or retaliation under

the law ◦ Informing any person about employer’s alleged discrimination

or retaliation under the law ◦ Cooperating with an investigation or prosecution of alleged

discrimination or retaliation under the law ◦ Opposing any policy, practice or act that employee in good

faith believes constitutes discrimination or retaliation under the law

◦ Informing any person of rights under the discrimination or retaliation provisions of the law

Employees have a private right of action and may file suit in court

Employees can seek actual damages suffered as a result of any violation plus an equal amount of liquidating damages

Can require employer to pay court costs and attorneys fees.

DOL oversees enforcement and has authority to investigate violations, hold hearing and impose penalties: ◦ Up to $250 for first violation

◦ $500 for each subsequent violation

Knowing & willing violates the Act – guilty of a disorderly persons offence

Administrative Penalties ◦ 1st-$100 to $1000 OR imprisonment 10-100 days

◦ 2nd -$500 to $1000 OR imprisonment 10-100 days or both

Administrative Fees ◦ 1st-$250

◦ 2nd - $250 to $500

◦ Plus other fees: percent of amount of payment – 1st 10%; 2nd – 18%; 3rd – 25%

Interest

Review the basic goals and objectives of the Law: ◦ Read summaries and if appropriate, an actual copy of Law

◦ Study the definitions and evaluate your present personal definitions

◦ Develop sources of information specific to Law

Gather your various documents and practices related to subject. Including: ◦ Employee handbooks

◦ Union contracts

◦ Notices and postings

◦ Practices – both exempt and non-exempt (This may require interviewing managers and supervisors in various functions.)

◦ Employment agreements – both written and verbal.

◦ Review time recording process

PR –

◦ Accrue paid sick leave hours beginning 10/29/18

◦ Do not have to allow usage until 2/26/2019 (120 calendar days after law effective)

◦ Employer may elect to allow use of earned sick leave prior to 2/26/2019

◦ If you have a sick leave policy prior to 10/29/18, employees are eligible to use that time prior to 2/26/2019 (still start accrual for NJ Paid Sick leave on 10/19/18)

◦ If you currently allow or wish to allow employees to donate sick leave time, it is allowable under the law (important to track)

Perform a gap analysis to determine need for change

What do you want? ◦ Is this the time to change overall or specific policies?

◦ Improve processes

◦ Be consistent

◦ Eliminate bad practices

Develop implementation plan: ◦ Add necessary resources – such as - recordkeeping –

policy documentation, etc.

◦ Determine if you need new payroll codes for absences

◦ Manager/Supervisor training

◦ Employee communications and training

Prior to the effective date of the Act (October 29, 2018) you should review and update your workplace handbooks, manuals, and policies to account for the Act’s provisions

Develop your policy: ◦ Define benefit year

◦ Identify any black out dates

◦ Advise if there will be a buy back at end of the year or unused accrue sick time will carry over (especially if front loading)

NJ DOL – issued notice: ◦ Post

◦ Distribute to all employees (recommend including company policy with notice)

NJ Paid Leave Insurance

Worker Compensation (waiting week)

NJ Disability (waiting week)

Over 25 employees ◦ NJ Safe Act

Over 50 employees ◦ NJFLA

◦ FMLA

NJLAD; EEOC and ADA considerations ◦ NJ Pregnant Workers Fairness Act (NJLAD)

Has been a substantial increase in pay discrimination claims ◦ Greater employee awareness

◦ EEOC added questions on charge intake about pay discrimination

◦ OFCCP focusing on compensation audits

Employers of all sizes in all industries have been affected

Which types of jobs/positions are at risk ◦ Highly compensated positions

◦ Highly populated positions

Effective July 1, 2018

Generally requires equal pay for “substantially similar work” by employees and provides coverage for ALL protected classes

Amends the NJ Law Against Discrimination (LAD) ◦ All employers are covered under LAD

“An employer to pay any of its employees who is a member of a protected class at a rate of compensation, including benefits, which is less than the rate paid by the employer to employees who are not members of the protected class for substantially similar work, when viewed as a composite of skill, effort and responsibility.”

Based on membership in any class protected by LAD: ◦ Race, creed, color, national origin, ancestry,

sex, age, disability ◦ Gender identity or expression ◦ Marital status, civil union status, domestic

partner status ◦ Affectional or sexual orientation ◦ Genetic information ◦ Atypical hereditary cellular or blood trait ◦ Pregnancy / breastfeeding ◦ Service in the armed forces

Discriminatory conduct occurs on occasion that compensation is paid in furtherance of an unlawful practice ◦ Each paycheck is evidence of a new and/or continuing violation

◦ Each paycheck restarts the statue of limitations

Cannot lower the compensation of any employee to remedy discriminatory conduct

Aggrieved employees may seek back pay for entire period in which a violation has occurred, not to exceed 6 years ◦ Significant expansion of the 2 year statue of limitations for pay equity claims previously imposed by LAD

Bona Fide factors include:

◦Training

◦Education

◦Experience

◦Quantity or Quality of Production

Prohibited from retaliating against employees

◦ For discussing with, or disclosing to any other employee or former employee, counsel and/or government entity relevant information concerning compensation and benefits

Cannot require as a condition of employee that an employee or protective employee sign a waiver or agree not to make these requests or disclosures or change any protections provided by LAD

Expands LADS’s anti-retaliation protections

Treble damages for violations

Punitive damages available for

willful acts

Reasonable costs and attorney’s

fees if a plaintiff prevails

Review hiring and compensation policies and practices to ensure employees are receiving equal pay for substantial similar work

Review titles, job responsibilities, compensation systems, annual pay increases, etc.

Any revisions necessary to handbooks, policies

Conduct training – especially supervisors on prohibiting retaliation

Base starting salary on factors other than prior salary

◦ Base decision on job related factors

Limit the amount of discretion when it comes to making pay decisions

◦ Ensure checks and balances

Document bases for pay decisions

Take steps to remedy and differences that could be attributed to membership in a protected class

Conduct Pay Equity Analyses

Develop Project Plan

Get management buy-in

Obtain attorney-client privilege

Research legitimate pay factors

Collect additional needed factors

Develop communication plan

Review pay processes and systems

Human Resource Consultants

Carol Asselta, SPHR; SHRM-SCP: ◦ 856 305-2650- carol.asselta@akziom.com

John H Knoop, Jr, SPHR; SHRM-SCP: ◦ 856 237-9792- john.knoop@akziom.com

1560 Catawba Avenue, Newfield, NJ 08344

808 Lake Larch Loop, Lakeland, FL 33805

www.akziom.com