Business Law

Published on: June 8, 2023

New Jersey Supreme Court Decision on Classification of Workers is a Cautionary Tale for Employers

Independent Contractors versus Employees Under New Jersey Employment Law

Under New Jersey employment law, the classification of a worker as an employee or independent contractor has significant ramifications for both the employer and employee, including the ability of the employer to shift the cost of insurance, payroll taxes and benefits to the employee, and relieving it from having to pay time and a half for overtime. The New Jersey Supreme Court explained in the seminal case of building-home-construction-contractor-blueprint-architecture-300x200 Hargrove vs. Speepy’s LLC, that there are different, fact sensitive tests for this determination depending on the context, such as for wage issues, workers compensation and unemployment. More recently, the Supreme Court addressed this issue in the context of whether an employer must make contributions for disability and unemployment in the case of East Bay Drywall, LLC vs. New Jersey Department of Labor and Workforce Development.

Background: East Bay’s Business Model

Published on: May 24, 2023

New Jersey Business Divorce Examined by Appellate Division

by Maurice W. McLaughlin

New Jersey business law presents no thornier area than business divorces – when a venture goes south and the owners – the partners, corporate shareholders or limited liability members – acrimoniously split up. The Appellate Division of the Superior Court of New Jersey recently addressed such a painful business divorce in the case of Segura columns-round-300x201 v. Shah.

Background: Christina Segura vs. Imran F. Shah

Christina Segura dated Imran Shah. After about six months they decided it would be a good idea to go into business together, so they formed a partnership. The partnership agreement allowed them to engage in virtually any profit-making business.

Published on: May 17, 2023

New Jersey Real Estate Law Decision Examines Duty to Disclose Defects in “As Is” Residential Real Estate Sales

by Maurice W. McLaughlin

New Jersey real estate law is enormously important – the purchase and sale of a home are often the largest transactions in many people’s lives. It is fraught with risks for both buyers and sellers.

For example, let’s say you’re buying a house and you receive a disclosure form from the sellers saying that there are no problems with the house, so you buy it and, lo and behold, there are significant issues. Do you have any recourse? The Appellate Division addressed that question in the recent case of Rogers vs. Conti.

Background: The Rogers vs. Conti Case

Published on: March 27, 2023

New Jersey Business Law Decision Examines Requirements for an Enforceable Contracts

by Maurice W. McLaughlin

Contract drafting and negotiation is one of the most important aspects of New Jersey business law. Contracts govern the relationship between business parties. Therefore, it is vital to ensure that a contract embodies the terms which the parties bargained for, and protects their interests. And it must meet all the legal requirements for contracts to be enforceable. signature-3113182__340-300x200

The Appellate Division recently explored those requirements, and the consequences which follow when they are not met, in the case of Tyler at First Street, LLC vs. Yengo.

Background

Published on: March 24, 2023

Federal Appeals Court Holds that Withholding Paid Time Off Will Not Defeat Professional Exemption to Minimum Wage and Overtime Requirements

by Maurice W. McLaughlin

The Federal Fair Labor Standards Act, like New Jersey’s Wage and Hour Law, requires that employees as a general rule must be paid a specified minimum wage, and overtime when they work more than 40 hours per week. However, certain classes of employees are exempt from these requirements. Thus, nonexempt employees need to be paid minimum wage and overtime, while exempt employees do not. In us-supreme-court-300x200 order to be considered an exempt employee under the exemption for “professional” employees, an employee must be paid on a “salary basis,” make at least $684 per week, and her work must require advanced knowledge in a field which is normally acquired “by a prolonged course of specialized intellectual instruction; or… requires invention, imagination, originality or talent in a recognized field of artistic or creative endeavor.”

The United States Court of Appeals for the Third Circuit, which hears appeals from the Federal trial courts in New Jersey, Pennsylvania, Delaware, and the United States Virgin Islands, recently examined the professional employee exemption in the case of Stephanie Higgins v. Bayada Home Health Care Inc.

Background

Published on: March 12, 2023

Liquidated Damages Provide Measure of Certainty Under New Jersey Contract Law

by Maurice W. McLaughlin

New Jersey Business Law and Liquidated Damages

Business parties draft contracts to give them a measure of certainty in their future relationship. However, it is not a secret that contracts are frequently breached, so parties often want a degree of certainty about what able-account-300x214 will happen in the event of a future breach. This gives rise to greater likelihood that the contract will be performed, and hopefully limits litigation costs if there is a breach. However, New Jersey business law, and indeed contract law generally, prohibits penalties in contracts. Thus, damages for breach of contract must reflect actual damages to put the innocent party in as good a place as it would have been had the breach not happened, rather than a greater amount to penalize a breaching party.

But when drafting a contract for a business relationship which will be performed in the future, it is often impossible to know what the amount of damages will be. Too many things are unknown, such as whether the relationship will be profitable and if so how profitable; and how much time will remain on the contract when a breach occurred, and thus how long the damages will accrue. For this reason New Jersey contract law allows for liquidated damages. Liquidated damages are an estimate of actual damages included in a contract to give more certainty about what will happen in the event of a breach. But liquidated damages must be a good faith estimate of actual damages in order to be valid and enforced.

Published on: February 26, 2023

New Jersey’s New Mass Layoff Law

by Pauline M.K. Young

New Jersey employees have significant protections during mass layoffs under New Jersey employment law.

In 1988 the United States Congress passed the Worker Adjustment and Retraining Notification Act (the “WARN” Act). The Act went into effect in 1989. The purpose of the Act was to try to assist employees with large layoffs or warn-300x201 large plant or factory closures. The Act essentially required advanced notice and other assistance to workers so that they would have time to find other employment.

In December of 2007 New Jersey passed its own Act similar to the federal WARN Act which was officially called the Millville Dallas Airmotive Plant Job Loss Notification Act, but is often just referred to as the New Jersey WARN Act in reference to its federal counterpart.

Published on: February 25, 2023

New Jersey’s Temporary Workers’ Bill of Rights

by Pauline M.K. Young

New Jersey is one of the most employee-friendly states in the nation; and its becoming more and more employee-friendly every year. On February 6, 2023, Governor Murphy signed the Temporary Workers’ Bill of Rights Act into law. This law clarifies and expands employee protections for non-exempt (hourly) employees who work for photo__1894482_mclaughlin_nardi_4712 temporary staffing agencies.

As a preliminary matter, it is important to note that this Act does not apply to all temporary workers. Indeed, a prior version of the law was vetoed by Governor Murphy who requested a narrower application of the law. As a result, the final law defines “temporary laborers” as those who contract for employment in a “designated classification placement” with a temporary staffing agency. “Designated classification placement” is further defined to include:

Food Preparation and Serving Related Occupations;

Published on: July 25, 2022

New Jersey’s Solid Waste Association of North America 2022 Conference

by Pauline M.K. Young

This past Spring, SWANA’s (Solid Waste Association of North America) New Jersey Chapter returned to their live Annual Conference following a two-year hiatus resulting from the Covid-19 pandemic.

The conference covered a wide range of topics related to the solid waste industry and New Jersey solid waste law, including safety in waste dump-truck-1396587__180 transportation, to the recent implementation of the plastic bag ban across the State, to fleet innovation and modernization. SWANA NJ panelists in fact noted that solid waste transporters are 10 times more likely to have fatalities than workers in other industries and that waste haulers have the 6^th most dangerous job in the United States (more dangerous than firefighters). Interestingly, statistics show that most accidents occur in March and June which – it is speculated – may be the result of an influx of pedestrians during these months. It is therefore recommended that waste transporters increase their safety meetings, briefings, and/or reminders to drivers and workers around these time periods.

SWANA’s national organization emphasizes their 5 tips for safe work practices. First, always wear Personal Protective Equipment. This is not limited to Covid masks. PPE for waste haulers may include high visibility vests and/or outerwear. Second, never use your cell phone while driving or working. Besides being illegal, distraction from cell phone use is a huge factor in accidents. Third (and mostly for municipal waste transporters) don’t ride on the step if the truck is backing up or traveling at more than 10 mph or for more than 1/5th mile at a time. Fourth, always comply with safety belt rules. Fifth, never speed and never rush.

Published on: July 16, 2022

New Jersey Non-Compete Agreements and Employee Duty of Loyalty Examined by Appellate Division

by Maurice W. McLaughlin

New Jersey law imposes certain requirements on the behavior of employees, whether through the common law or contract. New Jersey employment law and business law will enforce restrictive covenants, including non-compete agreements, if they meet certain requirements. However, the tests for enforceability are different for restrictive covenants contained in employment agreements and those which are part of stock-photo-4786200-handshake-at-the-business-meeting the sale of a business. Likewise, whether or not there are restrictive covenants, New Jersey employment law imposes on employees a duty of loyalty to their employers. The Appellate Division recently examined these requirements.

Background

Robert Ryerson was a registered investment advisor (RIA), providing financial planning and investment services until the National Association of Securities Dealers (NASD) found him guilty of misconduct in 2006 by sharing commissions with non-NASD members and intentionally misleading his employer. Ryerson owned and operated NCP, a small financial advisory firm. However, the NASD’s revocation of his license meant he could no longer operate NCP.