STATE UPDATES BENEFITS FOR STRIKING WORKERS

It is difficult to dismiss the day-to-day signs of workforces asserting their control over their terms and conditions of employment. Employers have faced the challenges created by cost increases, inflation, and continued challenges in the supply chain and logistics. From a human resources standpoint, employers are faced with challenges attracting and retaining workforces, remaining competitive, and re-engaging their workforces.

In many instances, employers have also absorbed the challenges created by a workforce seemingly more willing to unite and take action against their employers. Large and small employers alike have been confronted with this so-called concerted activity. Activities such as picketing, walk outs, slowdowns, and strikes are seemingly more common and often publicly supported.

According to statistics released by Cornell University’s ILR School, work stoppages caused by strikes and lockouts increased in 2022 by a factor of more than 50 percent compared to 2021. These actions, according to the report, most commonly occurred in the hospitality and food service industries (e.g., Starbucks). Non-unionized settings made up a strong minority: Approximately one-third of the more than 400 work stoppages reported were in non-union settings. Although the majority of the reported 2022 strikes lasted fewer than five days, current workers are seemingly more willing to make their dissatisfaction with employment conditions known to their employers and the public. This is despite low overall rates of unionization. It is important to note that such concerted activity is generally considered a legal right pursuant to the National Labor Relations Act.

Workers engaged in these types of job actions often forego income during periods of concerted action. In many instances, the lack of income ultimately worked to the benefit of the employer. Since employees are rarely able to sustain a prolonged period of lost income, employers had only to wait them out. In other words, employees had no choice but to return on less beneficial terms because they needed a paycheck.

New Jersey’s adoption of A4772/S3215 seeks to address the impact of lost pay during labor disputes. On April 24, Gov. Phil Murphy signed into law protections granting employees expanded access to unemployment insurance during periods of labor disputes.

This new law makes three important changes to the existing unemployment insurance benefit law. Although the law took effect

BY JENNIFER ROSELLE

on April 24, the law expressly extends the benefits retroactive to claims filed on or after Jan. 1, 2022.

The first notable change affects locked-out employees. As the name suggests, a lockout is when an employer denies the workforce access to its workspace unless it submits to certain conditions. In many instances, a lockout is the employer’s response to an employee strike. As baseball fans may remember, and basketball fans recently feared, this is not always the case. It is possible for an employer to impose a lockout even in the absence of a strike.

Prior to the adoption of this law, a precondition to unemployment insurance eligibility required that a strike immediately precede the lockout. With the adoption of the new law, employees who are locked out are now eligible for unemployment insurance, even when a strike does not precede the lockout.

In addition, employees affected by a work stoppage are now eligible for unemployment benefits sooner than in the past. The new law does not create a new right to benefits but shortens or eliminates the period of benefits disqualification. Until now employees affected by a work stoppage were generally deemed disqualified for a period of 30 days.

According to a statement made through Gov. Murphy’s Twitter account, “[w]orkers who express their right to strike over wages, benefits, or workplace conditions shouldn't worry about being able to pay their bills.” The new timelines in the law directly demonstrate that intention. Employees may be eligible for unemployment insurance immediately in situations where an employer hires replacement workers. Immediate eligibility attaches regardless of whether these are temporary or permanent replacement workers. In situations where striking workers are not replaced, a 14-day disqualification period attaches.

The final change clarifies that applicants are not disqualified from benefit eligibility when the labor dispute is due to an employer’s failure to follow the terms of a collective bargaining agreement or a failure to comply with state or federal laws governing wages, hours or conditions of work. According to the legislative history, this change is meant to serve only as a clarification of the prior version of the law.

The adoption of this law demonstrates the legislature’s