Employers need to be aware of two important actions recently taken by the New Jersey Department of Labor (NJDOL). First, the NJDOL has issued a new notice that must be distributed to employees and posted by December 7, 2011.
Second, the NJDOL has proposed an amendment to its regulations that would restore the "inside sales exemption."
The NJDOL has issued a new six-page notice regarding an employer's obligation to maintain and report records on wages, benefits, taxes, and other contributions and assessments pursuant to state wage, benefit and tax laws. The NJDOL is mandating that employers (1) provide a written copy of the notice to any employee hired after November 7, 2011; (2) provide current employees with a written copy of the notice no later than December 7, 2011; and (3) post the notice in a conspicuous location. Employers are permitted to provide employees with a written copy of the notice via e-mail.
The new notice details what records must be maintained under the following laws: Wage Payment Law, Wage and Hour Law, Prevailing Wage Act, Unemployment Compensation Law, Temporary Disability Benefits Law, Family Leave Insurance Benefits Law, Workers' Compensation Law, and Gross Income Tax Act. In addition, it lists contact information for various state offices in the event that an employee or an employee's authorized representative wishes to contact the state to provide information or to file a complaint about an employer's failure to meet the requirements outlined in the notice. A copy of the six-page notice can be accessed here.
Meanwhile, the NJDOL has proposed a regulatory amendment intended to cure its recent wage and hour misstep, by readopting the inside sales exemption. On September 6, 2011, the NJDOL adopted the Federal Fair Labor Standards Act's (FLSA's) so-called white-collar exemption for administrative, executive, professional or outside sales capacities. In doing so, the NJDOL unintentionally eliminated the New Jersey-specific regulatory overtime exemption known as the inside sales exemption. According to the NJDOL, the inside sales exemption exempted from overtime requirements "employees whose primary duty consists of sales activity and who receive at least 50 percent compensation from commissions and total compensation of not less than $400 per week."
Although the inside sales exemption was uniquely placed within New Jersey's administrative employee exemption, it has a federal counterpart in the FLSA's Section 7(i) exemption. The NJDOL has explained that Section 7(i) states that "no employer shall be deemed to have violated subsection (a) of Section 7 of the FLSA by employing any employee of a retail or service establishment for a workweek in excess of the applicable workweek specified therein, if (1) the regular rate of pay of such employee is in excess of one and one-half times the minimum hourly rate applicable to him under Section 7 of the FLSA, and (2) more than half his compensation for a representative period (not less than one month) represents commissions on goods and services."
The NJDOL is now attempting to reverse its error and restore the inside sales exemption by proposing an amendment that simply readopts its former inside sales exemption. While the inside sales exemption proposed for readoption differs from the Section 7(i) exemption, it does not exceed the FLSA's standards or requirements. The NJDOL will be accepting comments on the proposed amendment through January 20, 2012.