New Jersey To Enact the Nation’s Toughest Equal Pay Law

The New Jersey Legislature passed legislation this week that mandates equal pay to all New Jersey employees and penalizes New Jersey employers who discriminate against women and other protected classes in their paychecks. The bill has now been sent to Governor Murphy, who has made clear that he will imminently sign the bill into law.

The bill, entitled the Diane B. Allen Equal Pay Act, is named after state senator Diane B. Allen who left her broadcasting job in 1994 after filing gender and age discrimination complaints with the Equal Opportunity Employment Commission.   The New Jersey Equal Pay Act will modify the New Jersey Law Against Discrimination by strengthening the protections already provided by the current anti-discrimination law against employment discrimination by making it unlawful to discriminate against employees in their compensation.

Specifically, the New Jersey Equal Pay Act makes it an unlawful for an employer to pay a rate of compensation and benefits to employees of a protected class which is less than the rate paid to employees not in the same class for substantially the same work. Protected classes include such traits as sex, race, ethnicity, military status or national origin of the employee.  Once it is signed into law, the New Jersey Equal Pay Act will prohibit an employer from reducing the rate of compensation of any employee to comply with the new law.  This means that an employer who has been and continues to be in violation of the law cannot then decrease the compensation of any employee to the compensation of another employee who is being discriminated against in their compensation.

The New Jersey Equal Pay Act offers protections to the employers by specifically delineating different bona fide factors to be able to reasonably to show that any difference of pay amongst employees is not based upon discrimination, but instead legitimate business necessities.  These factors include differences in training, education, experience or the quantity or quality of production.  This provision will permit employers to defend themselves against differences in pay based upon legitimate non-discriminatory business reasons to pay more productive and valuable employees higher compensation than other less productive and less valuable employees.

The New Jersey Equal Pay Act also includes an anti-retaliation provision that makes it unlawful to take reprisals against any employee for discussing or disclosing information about job titles, occupational categories, rates of compensation and protected traits of employees with other employees, former employees, attorneys, or government agencies. This provision offers significant protections for any employee, not just those who are the victims of discrimination, to speak up and communicate any discriminatory business practices relating to compensation that they see or experience in the workplace.

The statute of limitations for any violation of the New Jersey Equal Pay Act is six (6) years and will restart after each occurrence of a discriminatory compensation decision or each instance in which the compensation is paid in violation of the law.  This means each time an employer pays an employee in a discriminatory manner, the six (6) year statute of limitations restarts allowing an employee to bring an action for each and every violation during the past six (6) years.

The New Jersey Equal Pay Act provides for significant penalties to employers for non-compliance of the law.  For example, if an employer is found to be in violation of the New Jersey Equal Pay Act by the Director of the Division on Civil Rights or by a court of law, the employer will have to pay the aggrieved person an additional amount equal to three (3) times of any monetary award.

While it is true that current New Jersey law prohibits employers from discriminating against persons on the basis of their pay, the Diane B. Allen Equal Pay Act will undoubtedly strengthen the protections against pay discrimination that are already provided for under the Law Against Discrimination.  If you believe you are or have been discriminated by an employer in your pay based upon your protected class, please feel free to contact one of our New Jersey Employment Lawyers to discuss the specific facts of your situation.