Assembly Panel Advances Bill Imposing Tougher Penalties On Employers Who Fail To Pay Workers

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Assembly Speaker Sheila Oliver

TRENTON – Legislation that would toughen enforcement and criminal sanctions against employers who fail to pay wages or other benefits to their employees was approved Tuesday by an Assembly panel.

“Many families are struggling as it is. Having your wages or any other form of compensation kept from you is not only an abuse of power, but can wreak havoc on a person’s finances,” said Assembly Speaker Sheila Oliver (D-Essex/Passaic). “This behavior is disgraceful and has no place in the workforce. This bill ensures that employers who have no qualms about cheating their workers this way will face stiffer penalties.”

The bill (A-3581) revises current law to strengthen enforcement procedures and criminal sanctions against employers who fail to pay wages, compensation or benefits to their employees. The bill also imposes criminal sanctions against employers who retaliate against employees who file complaints under the statute and establishes definitions of key terms and phrases found in the statute.

“These are wages and benefits that employees have worked for and earned. It’s simple. You work, you expect compensation in return. Cheating them out of what is rightfully theirs is exploitative and cannot be tolerated,” said Assemblyman Peter J. Barnes, III (D-Middlesex). “Putting tougher penalties in place will hopefully make these employers think long and hard before they even consider swindling their workers.”

Under the bill, an employer who commits a violation would be required to pay the employee wages owed, plus liquidated damages equal to 100 percent of the wages owed. In addition, an employer found guilty would be fined $500 plus a penalty of 20 percent of the wages owed for a first offense, and a fine of $1,000 plus a penalty of 20 percent of the wages owed for subsequent offenses. Lastly, retaliating against an employee for bringing a claim under the statute would be considered a disorderly persons offense and the employer would be liable to the employee for damages.

The bill also requires the Attorney General, or the Attorney General’s designee, to notify the Commissioner of Labor and Workforce Development when an employer is convicted under the statute. Upon notification of a conviction, the commissioner may, after affording the employer notice and an opportunity for a hearing, issue a written determination directing each appropriate agency to suspend any license that is issued by the agency to the employer for a period of time determined by the commissioner. The bill also requires the commissioner to conduct an audit or inspection of the employer no more than 12 months after the date of the commissioner’s written determination.

If the commissioner determines that the employer or successor firm has continued in its failure to pay wages, compensation or benefits, or if the commissioner is notified of a subsequent violation by the employer, the commissioner, after affording the employer or successor firm notice and an opportunity for a hearing, would be required to issue a written determination directing each appropriate agency to permanently revoke any license issued to the employer or any successor firm.

The Department of Labor and Workforce Development would be required to contract with community-based organizations and legal services organizations to disseminate information regarding the protections and procedures established in the statute, as well as to investigate, prepare, and if necessary, represent employees that file complaints under the statute. These organizations would be required under the bill to make all services accessible to persons with limited English proficiency.

Finally, the commissioner, in consultation with the Administrative Director of the Courts and the Attorney General, is required to submit to the Legislature twice each year a report evaluating the effectiveness of the provisions of this bill and recommendations for strengthening its enforcement.

The bill was released by the Assembly Budget Committee.


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