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USLAW
SPRING 2025 USLAW MAGAZINE
Changes in New Jersey Employment Law in 2025
WhatEmployersAcrossthe CountRyNeedtoKnow Michael A. Shadiack
Often at the forefront of the evolution of employment law, the state of New Jersey has recently adopted several changes that promote transparency and equal rights in the workplace. Businesses that have employees in the Garden State should heed these changes and determine if they need to comply even if they do not have a physical presence in New Jersey. THE PAY TRANSPARENCY ACT On November 18, 2024, Governor Philip D. Murphy signed into law the Pay Transparency Act (the “Act”). The Act requires New Jersey employers to identify wage and benefit information for all promotional opportunities and employment listings. The law will go into effect on June 1, 2025. The Act defines an employer as any person, company, corporation, firm, labor organization, or association that has at least 10 employees over 20 calendar weeks and does business in New Jersey and employs people within New Jersey or takes applications for employment within New Jersey. Job placement, referral agencies, and other employment agencies are included in the definition of employer if they meet the above requirements. However, the Act does not require temporary-help service
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firms and consulting firms that are registered with the Division of Consumer Affairs to include compensation ranges in their job postings. Such organizations are, however, required to disclose that information during interviews for a position or when they offer a job to a particular candidate. Covered employers that advertise a promotion, new job, or transfer opportunity must disclose the hourly wage or salary (or the salary range) for the position and a general description of all benefits and other compensation programs for which the successful applicant would be eligible. When making an offer of employment to an applicant, employers may offer the applicant higher wages or compensation or greater benefits than what they listed in the job posting. Further, if a covered employer advertises a position (internally or externally) that would qualify as a promotion for an existing employee, the employer must make “reasonable efforts” to announce, post, or otherwise make known the promotion opportunity to all current employees in the affected department(s) prior to making any promotion decision. Promotions that are based on years of experience or performance are excluded from this provision. Employers are also exempt from these
requirements if they make a promotion decision on an “emergent basis due to an unforeseen event.” The Act broadly defines a promotion as “a change in job title and an increase in compensation.” The Act does not, however, define what constitutes a reasonable effort, an emergent basis, or an unforeseen event. New Jersey has not yet issued guidance on these questions and employers should be aware that guidance may be forthcoming. The Act does not establish a private right of action by an employee, but the New Jersey Commissioner of Labor and Workforce Development has enforcement authority. Employers that violate the Act will be subject to a civil penalty of up to $300 for the first violation and up to $600 for each subsequent violation. An employer’s failure to comply with the Act for one job opening or promotional opportunity constitutes one violation, even if the employer posts the opening on multiple sites and forums. While this law is applicable to covered New Jersey employers only, pay transparency laws are quickly being enacted across the country. Currently, 15 states and the District of Columbia have wage transparency laws. Wage transparency laws in the following five of those 15 states go into effect