What is “Misconduct” under New Jersey Unemployment Law?

On August 24, 2018, New Jersey has passed Bill A-3871, which amends N.J.S.A. 43:21-5 of the New Jersey Unemployment Insurance Law by eliminating the severe misconduct disqualification as well as other changes to New Jersey unemployment laws.  One of the key changes in the bill is revising the definition of legal definition of what constitutes misconduct, along with modifying the misconduct disqualification period for misconduct was also changed in the new law from 7 weeks to 5 weeks.

Under the new unemployment law, misconduct is now defined as follows:

[b]ehavior, other than gross misconduct, conduct which is improper, connected with the individual’s work, malicious, within the individual’s control, not a good faith error of judgment or discretion, and is either a deliberate refusal without good cause, to comply with the employer’s lawful and reasonable rules made known to the employee or a deliberate disregard of standards of behavior the employer has a reasonable right to expect, including reasonable safety standards and reasonable standards for a workplace free of drug and substance abuse.

In addition to the above definition for misconduct, the new unemployment law also provides for specific examples for the types of workplace conduct that would give rise to a misconduct disqualification of unemployment benefits.  These examples include the following:

  • repeated failure, without good cause, to comply with instructions of the employer which are lawful, reasonable, and not requiring the employee to perform services beyond the scope of the employee’s customary job duties;
  • falsification of an employment application or other record required by the employer to determine the employee’s qualifications or suitability for the job or omitting information which created a material misrepresentation of the employee’s qualifications or suitability for the job;
  • tardiness without good cause which is chronic or excessive and repeated after written warnings from the employer; and
  • repeated unauthorized absences without good cause, such as illness or other compelling personal circumstances, or unjustified failure to provide notice prior to the unauthorized asbsences.  An individual’s failure to meet standards regarding quality or quantity of work shall not be considered misconduct unless the employer demonstrates to the division that the standards are reasonable and that the individual deliberatively performed below the standards.

Finally, the new definition of misconduct makes clear that misconduct will not include “advertence or ordinary negligence in isolated instances, or inefficiency or failure to perform as the result of inability or incapacity.”  This is an important clarification of the law that now makes it clear that ordinary negligence in performing job duties, as opposed to intentional, malicious and deliberate conduct, is not a basis for disqualifying a terminated employee from receiving unemployment benefits.

Another significant change in the new definition of misconduct is the placing of the burden on the employer to prove that its termination of the employee was for misconduct connected to the work by requiring the employer present to the Department of Labor with written documentation at or immediately following the incident of misconduct showing that the employee’s actions meet the requirements for all forms of misconduct, including gross misconduct.  Unlike misconduct, gross misconduct is a total disqualification for unemployment benefits opposed to the 5 week penalty provided for misconduct.  The definition of gross misconduct remains unchanged with the new law and occurs when an employee is terminated for conduct connected with the work that is punishable as a crime of the first, second, third or fourth degree under the New Jersey Code of Criminal Justice.  Examples of gross misconduct include such acts like theft, assault, fraud or criminal actions taken by the employee in connection with their job.

While the new unemployment law does not specifically state that the new definition of misconduct will be applied retroactively from its August 24, 2018 passing into law, our New Jersey unemployment attorneys have been advised by the Appeal Tribunal in connection with a recent Appeal Tribunal proceeding that the New Jersey Unemployment Deputys, Appeal Tribunal Examiners and the Board of Review will decide unemployment appeals in accordance with the dictates of new unemployment law regardless of when the misconduct or termination occurred. If this remains the case, this means that claimants who are currently appealing a severe misconduct disqualification will only be disqualified under the new definition of misconduct and the unchanged definition of gross misconduct in their connection with the final determination of their appeal.

Our New Jersey unemployment lawyers will continue to closely monitor any future changes in New Jersey unemployment law and whether the new unemployment law will be applied retroactively from the August 24, 2018 passing in connection with how the Department of Labor and eventually the Appellate Division decides cases of terminations that occurred prior to the August 24, 2018 passing of the new.  Should you need advice and counsel concerning your own unemployment related issue, please feel free to contact us to speak to one of our New Jersey unemployment lawyers to discuss the specific facts and circumstances regarding your particular matter.

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