Fine Print: New Guidelines Spell Out How NJ’s Equal-Pay Law Should Work

John Reitmeyer | March 4, 2020 | Business, More Issues
Equal-pay protections were revamped in 2018, giving New Jersey the strongest such rules in the United States
Credit: Governor's Office
Gov. Phil Murphy signed the pay-equity legislation on April 24, 2018 surrounded by long-time supporters of the legislation.

What it is: A new set of guidelines detailing the provisions of New Jersey’s strict equal-pay law, published this week by the state Division on Civil Rights.

Who the guidelines are for: State officials say the new guidelines are useful for both employers and employees, applying to the public and private sectors alike.

Why they’re important: Updates to New Jersey’s equal-pay law enacted by Gov. Phil Murphy and lawmakers in 2018 made the state’s protections against gender-pay discrimination stronger than federal law, and also tougher than any other state law. The new guidelines seek to explain exactly what New Jersey’s law does to protect against discriminatory pay practices, including by providing a lengthy question-and-answer section.

Complaints have already been brought: “This guidance explains the Equal Pay Act in terms that are easy for employers and employees to understand, and answers questions that DCR has received about how it interprets the Act,” said Rachel Wainer Apter, director of the Division on Civil Rights. “We have already had several complaints brought under the Act, and will continue to use our enforcement authority to address unequal pay going forward.”

The basics: The New Jersey Equal Pay Act went into effect in July 2018, months after Murphy it signed into law. The goal of the law is to prevent employers in New Jersey from paying members of any group whose characteristics are protected under federal law less than what they pay other employees who perform “substantially similar” work. The effort to revise the state law was bipartisan, and it came after studies at the time showed women who were working full time in New Jersey were earning about 81 cents for every $1 that men earned.

Who is protected against pay discrimination under New Jersey’s law? The state protections are not just aimed at pay differences between men and women. They also apply to cases involving “race, creed, color, national origin, ancestry, age, marital status, civil union status, domestic partnership status and affectional or sexual orientation.” Protections are also extended for “pregnancy or breastfeeding, sex, gender identity or expression, genetic information, disability or atypical hereditary cellular or blood trait, liability for service in the Armed Forces of the United States, nationality, and refusing to submit to a genetic test or make available the results of a genetic test.”

The exceptions: Differences in pay are still allowed under the law, but only if they occur “pursuant to a seniority system or a merit system.” Otherwise, they must be based on one or more legitimate factor, such as training, education or experience, or quality or quantity of their work product. The factors also must account for the entire wage differential; and they must be based on a legitimate business necessity.

Remedies for violations: Several punishments were upgraded in the new law for cases where it has been established that an employer has violated the Equal Pay Act. They include allowing for damages that are worth three times the amount of any determination of monetary losses, not the two-year standard that had previously been allowed. Back pay for as many as six years of discrimination was also established in the new law, upgrading a previous two-year standard.

Other remedies for violations allowed under the law include reinstatement or promotion and recouping attorneys’ fees and lost wages for the complainant. Damages for emotional distress can also be assessed. Employers also face possible civil penalties, including up to $10,000 for an initial violation during a five-year period, up to $25,000 for two violations during a five-year period, and up to $50,000 for a third violation over a seven-year period.

Anti-retaliation rules: Also beefed up under the new law were regulations that are intended to prevent employers from retaliating against any worker who files an equal-pay complaint, or seeks information that could lead to a complaint being filed. Fully protected against retaliation under the law are those who seek “legal advice regarding rights,” those who share “relevant information with legal counsel,” or those who share “information with a governmental entity.” The updated law also explicitly prohibits employers from asking workers to waive their right to request such information.

Reporting requirements for state government contractors: The law also established new requirements for companies that enter into deals with state government to provide contracted services. They include disclosing to the Department of Labor and Workforce Development certain information about their workers who are employed in connection with the contract, including wage and demographic data. The disclosure must also include the gender, race, ethnicity, job category, compensation, and number of hours worked by each employee.

How to file a complaint: Anyone seeking to file a complaint under the Equal Pay Act should visit www.NJCivilRights.gov, or call (973) 648-2700. Complaints can also be filed in the courts.