NJ Pay Transparency Law Now in Effect – Is Your Company Ready?
If you’re an employer who operates in New Jersey, employs New Jersey residents, or accepts applicants from NJ, it’s time to check your job postings.
As of June 1, the New Jersey Pay and Benefits Transparency Act is in effect. This law is designed to give jobseekers access to key information such as pay, benefits, and compensation programs before they apply for a job or internal transfer. It applies to all types of job postings, including printed materials, digital listings, social media, newsletters, and even emails.
Who Does This Law Apply To?
Any employer who:
- Has more than 10 employees over 20 or more calendar weeks, and
- Does business in NJ, employs or accepts applicants from NJ state residents.
This means that even if your organization does not operate in New Jersey and has no current NJ employees, if you accept applicants from NJ, you still need to comply. For example, if your organization has remote roles and NJ job seekers can apply, this law applies to you.
How to Remain Compliant
1. Requirements for Posted Pay
| Requirement/s | Dos | Don'ts |
|
The exact rate or the range of the hourly wage or salary |
✔ $18-$20/hr ✔ $60,000 - $70,000/per year ✔ $15.00/hr |
✖ Up to $20/hr ✖ Starting at $60,000/per year ✖ Competitive Pay! |
|
If commission is part of pay, a general overview of that commission is required |
✔ $80,000 base + 8-10% commission per unit sold |
✖ $80,000 + Commission! |
|
For a piece-rate role, include the rate or scale plus any agreed rates. |
✔ $.75 - $.95 per bucket picked ✔ $.75 - $.95 per bucket picked or $20/hour, whichever is higher
|
✖ Starting at $.75 per bucket picked ✖ Up to $.95 per bucket picked |
2. Requirement for Benefits
| Requirement/s | Dos | Don'ts |
|
Job postings must include a general description of benefits. While you don’t need to detail every benefit, you should include a summary of the key offerings. |
✔ Health/Dental/Vision Insurance; PTO; 401k + matching program; Tuition Reimbursement |
✖ Competitive benefits! OR ✖ Health, dental, and more…
|
3. Requirement for Other Compensation Programs
Any other compensation programs (outside of traditional wages) that a role is eligible for should also include a general description. This can include incentive plans or stipends such as car, phone, or uniform allowances.
Promotional Opportunities
An employer must make a reasonable effort to ensure current employees in affected departments are aware of promotion opportunities. This can be done via internal postings or external. However, if an employee is being promoted due to years of experience or performance, that promotion is not subject to the notification requirements.
Compliant Example: A manager has left an organization, creating a leadership vacancy. This opening is posted on the company’s internal job board along with external job boards. A few internal employees apply for the role and are interviewed along with a few external candidates. Based on qualifications, the company moves forward with one of the internal candidates.
Non-Compliant Example: A senior-level position has become vacant due to a retirement. The hiring manager for that role has a friend who they feel would excel in the position and decides to hire them. Multiple current employees have the years of experience and qualifications needed for that position, and if they had been notified of the opening, they would have applied. This would be considered a violation under the NJ Pay and Benefits Transparency Act because reasonable steps were not taken to ensure current employees were aware of a promotional opportunity.
Penalties of Non-Compliance
Violations of this law are determined per job, not per posting. For example, if a company has one job posting (that doesn’t follow the guidelines) posted across multiple platforms, that would count as one offense. If a company has 5 jobs posted on one platform, then that would be considered five violations because each jobs’ posting did not follow guidelines.
Penalties can include fines up to $300 for the first violation and up to $600 for each subsequent violation.
Temporary Service and Consulting Firms
Temporary service agencies and consulting firms are not expected to provide hourly wage or salary, a general description of benefits, and other compensation programs until the interview stage or at time of hire for new openings.
In conclusion, any New Jersey employer, or employers in any state who accept applications from or employs New Jersey residents, should take a moment to carefully review their job postings. Your postings must include a specific salary or range and provide general information on benefits and other compensation programs. Current employees must be reasonably informed of any promotional opportunities as well.
For more information and to see the law written in full, check out: https://www.nj.gov/labor/myworkrights/wages/pay-transparency/. If you have additional questions or would like to talk to one of our advisors on how this law impacts your business, please contact our Human Capital & HR Consulting team.
Article Contributed by Jessica Keck
