Building a team is a critical step in the process of growing a small business, but it brings unique issues and challenges. Employment laws at the federal, state, and local levels affect almost every aspect of the employer/employee relationship. Here is a brief overview of some laws that New Jersey small business owners should know, with a focus on laws at the state level.
The New Jersey Wage and Hour Law (WHL), N.J. Rev. Stat. § 34:11-56a et seq., governs wage rates throughout the state. As of January 1, 2015, the minimum wage for employers in the State of New Jersey is $8.38 per hour. The federal minimum wage has been $7.15 per hour since 2010. 29 U.S.C. § 206(a)(1)(C).
The minimum wage for employees, such as food servers, who receive gratuities or tips from customers is $2.13 per hour. This is the same as the federal rate. If an employee’s tip income is less than $6.25 per hour for a pay period, however, the employer must make up the difference to bring their wage up to $8.38 per hour.
This provision does not apply to “any individual employed in a bona fide executive, administrative, or professional capacity,” often known as “exempt” employees.
A person hired for a specific purpose or for a limited period of time may be deemed an “independent contractor,” rather than an employee, in some circumstances. Independent contractors do not have the same protections as employees under wage and hour laws.
Courts around the country have considered how to define an independent contractor for employment law purposes. The New Jersey Supreme Court has adopted the “ABC test,” based on the analysis used in the New Jersey Unemployment Compensation Act, N.J. Rev. Stat. § 43:21-19(i)(6), to determine if a person is an independent contractor:
A. The person is “free from control or direction” by the employer in their job performance;
B. The service provided by the person is either outside the employer’s usual business, or is performed away from its usual places of business; and
C. The person regularly works independently of any employer.
Hargrove v. Sleepy’s, L.L.C., 106 A.3d 449, 458 (N.J. 2015).
Certain employees are entitled to unpaid leave for medical reasons under state and federal law.
Under the federal Family and Medical Leave Act, 29 U.S.C. § 2601 et seq., an employee may take up to 12 weeks of leave in a 12-month period if:
– Their employer has at least 50 employees within 75 miles;
– They have worked for the employer for at least one year; and
– They have worked at least 1,250 hours during the previous year.
The New Jersey Family Leave Act, N.J. Rev. Stat. 34:11B-1 et seq., allows up to 12 weeks of leave in a 24-month period if:
– The employer has at least 50 employers anywhere in the world;
– The employee has worked there for at least one year; and
– The employee has worked at least 1,000 hours in the previous year.
Business owners and entrepreneurs in the New York City and Northern New Jersey area need the assistance of an experienced and skilled business law attorney. Samuel C. Berger offers fixed-fee legal-service packages that address a wide range of legal matters. To schedule a confidential consultation to see what we can do for you, contact us today online or at (212) 380-8117.
More Blog Posts:
New York City Sets Aside Over $1 Million for Worker-Owned Cooperative Businesses, New York & New Jersey Business Lawyer Blog, July 7, 2014
New Jersey Businesses Required to Provide Gender Equity Notice to Employees, New York & New Jersey Business Lawyer Blog, February 13, 2014
Employees in a New Jersey Family Business May Not Be Relatives, but Should Be Part of the Business Family, New York & New Jersey Business Lawyer Blog, May 8, 2013
Photo credit: By Employeeperformance (Own work) [Public domain], via Wikimedia Commons.