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New Jersey Overtime Laws

New Jersey Overtime Laws

Introduction

New Jersey overtime laws are in place to ensure that employees are compensated fairly for the extra time they put into their work beyond their scheduled hours. Overtime is an essential aspect of employment in New Jersey, as it enables employees to earn more money while also helping companies meet their deadlines. It is, therefore, essential to understand the state’s overtime laws to protect the rights of employees and ensure that companies comply with the regulations.

In this article, we will discuss New Jersey’s overtime laws, including the basics of overtime pay, when overtime applies, exemptions to overtime, and the penalties for violations. We will also look at changes that have been made to New Jersey’s overtime laws in recent years and what those changes mean for employees and employers.

The Basics of Overtime Pay in New Jersey

The Fair Labor Standards Act (FLSA) is the federal law that regulates overtime pay, but individual states can also enact their own overtime laws. In New Jersey, both state and federal laws apply to most workers.

Under federal law, non-exempt employees are entitled to overtime pay of one and a half times their regular rate of pay for all hours worked over 40 hours in a workweek. New Jersey’s overtime laws are similar to the FLSA, but there are a few key differences.

In New Jersey, non-exempt employees are also entitled to overtime pay of one and a half times their regular rate of pay for all hours worked over 40 hours in a workweek. However, New Jersey law also requires overtime pay for work in excess of eight hours in a day, as well as for the first eight hours worked on the seventh consecutive day in a workweek. This means that an employee who works ten hours in a day and 35 hours in a workweek will not receive overtime pay under federal law but would be entitled to two hours of overtime pay under New Jersey law.

Calculating Overtime Pay in New Jersey

Calculating overtime pay in New Jersey can be slightly complicated, as the state has different rules for different types of employees. Here are the basics of how overtime pay is calculated in New Jersey:

– Hourly Employees: Hourly employees are paid by the hour and are entitled to overtime pay of one and a half times their regular rate of pay for all hours worked over 40 hours in a workweek.

– Salaried Non-Exempt Employees: Salaried non-exempt employees are paid a fixed salary but are entitled to overtime pay if they work more than 40 hours in a workweek. To calculate their overtime pay, divide their weekly salary by the number of hours worked in the week to get their regular rate of pay, then multiply that by one and a half for all hours worked over 40.

– Salaried Exempt Employees: Salaried exempt employees are not entitled to overtime pay under state or federal law, regardless of how many hours they work. However, there are exceptions to this rule, which we will discuss later in this article.

When Overtime Pay Applies in New Jersey

As we mentioned earlier, New Jersey’s overtime laws require employers to pay employees overtime for work in excess of eight hours in a day, as well as for the first eight hours worked on the seventh consecutive day in a workweek. This applies to most non-exempt employees, with some exceptions, including those in executive, administrative, or professional positions.

Exemptions to Overtime in New Jersey

There are several exemptions to New Jersey’s overtime laws, which means that certain employees are not entitled to overtime pay. These exemptions are usually based on an employee’s job duties or salary.

Here are the primary exemptions to New Jersey’s overtime laws:

– Executive, Administrative, and Professional Exemptions: Employees in these positions are exempt from overtime pay if they meet certain criteria. To be exempt, an employee must:

– Be paid a salary of at least $684 per week (the equivalent of $35,568 per year);
– Have job duties that primarily involve executive, administrative, or professional duties as defined by the FLSA; and
– Have the authority to make significant decisions that affect the company’s operations.

– Outside Sales Exemption: Employees who work in outside sales positions are exempt from overtime pay if their primary duties involve making sales or obtaining orders or contracts for services or goods.

– Computer Employee Exemption: Employees who are engaged in computer-related occupations are exempt from overtime pay if they meet certain criteria. To be exempt, an employee must:

– Be paid a salary of at least $684 per week (the equivalent of $35,568 per year) or be paid an hourly rate of at least $27.63 per hour;
– Be employed as a computer systems analyst, computer programmer, software engineer, or similar skilled worker in the computer field; and
– Have job duties that primarily involve the application of systems analysis, programming, or software engineering in the computer field.

Penalties for Failing to Pay Overtime in New Jersey

If an employer fails to pay overtime to an eligible employee in New Jersey, they can be subject to serious penalties. These penalties can include:

– Back Pay: The employer may be required to pay the employee all the back pay they are owed for the overtime they worked.
– Liquidated Damages: Employers who fail to pay overtime may be required to pay an additional liquidated damages penalty equal to the amount of unpaid overtime.
– Interest: The employer may be required to pay interest on the unpaid overtime from the date it was due until the day it is paid.
– Attorney’s Fees: If an employee sues their employer for unpaid overtime and wins, the employer may be required to pay the employee’s attorney’s fees and court costs.

Changes to New Jersey’s Overtime Laws in Recent Years

New Jersey’s overtime laws have undergone some significant changes in recent years. Here are some of the most notable changes:

– Increase in Salary Threshold for Exemptions: In September 2019, New Jersey’s Department of Labor and Workforce Development announced a new rule that increased the salary threshold for exempt employees from $455 per week to $684 per week. This change brought New Jersey’s overtime laws in line with the federal overtime regulations.

– Elimination of the “White Collar” Exemption: In January 2020, New Jersey’s state legislature passed a new law that eliminated the “white-collar” exemption from the state’s overtime laws. The white-collar exemption allowed employers to classify employees in executive, administrative, or professional positions as exempt from overtime if they met certain criteria. With the elimination of this exemption, all employees in New Jersey must be paid overtime unless they meet the criteria for one of the other exemptions.

– Increase in Minimum Wage: In July 2019, New Jersey’s minimum wage increased to $10 per hour for most employees and $8.85 per hour for tipped workers. The minimum wage is set to increase each year until it reaches $15 per hour in 2024. This increase in minimum wage means that some employees who were previously exempt from overtime may now be entitled to it if their salaries do not meet the new threshold.

Conclusion

Understanding New Jersey’s overtime laws is essential for both employees and employers. It ensures that employees are fairly compensated for the extra time they put into their work and that employers comply with the regulations. With the recent changes to New Jersey’s overtime laws, it is now more critical than ever for employers to review their employment policies and ensure that they are in compliance. By doing so, they can avoid costly penalties and legal issues down the line and maintain healthy and prosperous working relationships with their employees.


What are New Jersey Overtime Laws?

New Jersey Overtime laws are instituted and enforced by the Division of Wage and Hour Compliance administration. This agency administers and enforces the state’s labor laws through the enforcement of minimum wage, laws concerning child employment and methods of wage payments. The Division of Wage and Hour Compliance also regulates the overtime wage rate.

The New Jersey State Wage and Hour Law mandate the payment of time and one half per hour for all employees working in excess of 40 hours. These are the basic New Jersey overtime laws; however, certain exemptions are attached to said policy.

To be exempt—according to New Jersey Overtime Laws—as an executive employee, an individual must:

• NJ Overtime laws states the employee must regularly direct the work of multiple (two or more) full-time employees

• NJ Overtime laws states the employee must possesses management as his/her primary job function

• NJ Overtime laws states the employee must possess the authority to hire and terminate or recommended said action or other changes in an employee’s working status

• NJ Overtime laws states the employee must be compensated on a salary basis

• NJ Overtime laws states the employee must Spend no more than 1/5th of their time in activities not closely related to any of the above duties or 40% in a service or retail establishment

To be exempt—according to New Jersey Overtime Laws—as an Administrative Employee, a person must:

• Possess as their “primary duty” the following:

o NJ Overtime laws states the employee must partake in Non-manual or office work related to management policies or traditional business operations

o NJ Overtime laws states the employee must perform work in an educational administration function, aka work directly related to training or academic instruction

• NJ Overtime laws states the employee must partake Regularly exercise independent judgment and discretion

• NJ Overtime laws states the employee must assist bona fide executives or other administrative employees

• Perform general supervision work that is technical or specialized that requires special training, knowledge or experience

• Perform special assignments under only general supervision

To be exempt as a Professional Employee—according to New Jersey Overtime Laws—one must:

• Have his/her primary duties include :

o Advanced knowledge typically requiring extensive education

o Creativity in a recognized artistic field

o Teaching imparting knowledge as a formal professor or teacher in an academic institution

o Practical application of highly specialized knowledge in computer platforms, programming, software engineering etc.

• Constantly exercises discretion and judgment

• Performs work that is predominantly eclectic and intellectual and which cannot be standardized in relation to a given time frame

• Spend no more than 20% of working hours—during a typical work week—in activities viewed as non-essential to the above duties

• Compensated on a “salary basis”

New Jersey Overtime Laws: Off-Clock Work

If you do not fit any of the above classifications (typically hourly employees) and you are required—by your employer—to work “off the clock” you will typically be entitled to overtime compensation. Some examples of working “off the clock” include the following:

• Your supervisor or manager requires you to complete a task before leaving work but argues that is taking too long and requires you to clock out while expecting you complete the task before leaving

• Uniforms are changed at work before an employee clocks in and changes after an employee clocks out

For a complete list of NJ overtime laws, please visit the following page.