Beginning November 12, 2012, the State of New Jersey will require employers to post a new “equal pay” notice in the work place, to provide the notice to employees and to obtain an acknowledgment of receipt. Effective November 18, 2012, the City of Newark will impose restrictions on employers conducting hiring in the City with regard to the use of criminal background checks for job applicants.

Equal Pay Poster and Notice to Employees

The State of New Jersey has introduced a new requirement for employers with 50 or more employees in New Jersey to post and distribute to employees a notice that State and federal law provides for gender pay equity and prohibits wage discrimination based on gender. The law was signed by Governor Christopher Christie on September 12, 2012 and goes into effect on November 12. Employers must provide the notice to (1) all employees within 30 days after the New Jersey Commission of Labor and Workforce Development issues a form notice to the public, (2) all new hires, (3) all employees annually on or before December 31 of each year and (4) upon the first request of an employee.

Requirements for Employer Compliance

The new law contains explicit requirements and options for employer compliance. It specifies the methods available to deliver the notice:

  1. By email delivery;
  2. Via printed material, including, but not limited to, a pay check insert, brochure or similar informational packet provided to new hires, an attachment to an employee manual or policy book, or flyer distributed at an employee meeting; or
  3. Through an Internet or Intranet website, if the site is for the exclusive use of all workers, can be accessed by all workers, and the employer provides notice to the workers of its posting.

Employers must obtain a signed acknowledgment from employees within 30 days of the employee’s receipt. It is the first of its kind for NJ employers to require employees to sign an acknowledgment of having received the notice. The notice must be posted and distributed in English and Spanish and in any other language the State has made the poster available — if the employer reasonably believes the alternative language is the first language of a significant portion of its workforce.

Some Questions Remain

Employers may receive more guidance from the New Jersey Department of Labor and Workforce Development once it issues the form “notice” to be posted and distributed. The New Jersey Wage and Hour Law (WHL) provides for penalties for non-compliance. It is not clear whether a violation of this new law will trigger the standard penalties under the WHL. Also, it is not clear whether an employer’s failure to provide the notice could be used as evidence in litigation in support of a claim for higher damages.

Guidance for Employers

The notice and distribution requirement applies to employers with 50 or more employees. However, the New Jersey Law Against Discrimination, which prohibits gender-based discrimination in compensation and benefits in the workplace, applies to all employers. Title VII of the Civil Rights Act of 1964 and the Equal Pay Act, which similarly prohibit gender discrimination, have other thresholds. For example, Title VII applies to employers with 15 or more full or part-time employees. Although employers who are covered by these statutes may be exempt from the new posting requirement, employers still must comply with the federal and state anti-discrimination obligations.

Pay discrimination has become a hot issue. A recent, major initiative of both the Equal Employment Opportunity Commission and the equivalent state agencies has been to address compensation inequality based on gender. Employers should take the time in light of this new notice obligation to audit their compensation practices and systems (with counsel) to identify any disparities and/or prepare to defend against them if challenged through documentation and/or reasonable explanations.

Criminal Background Inquiries for Newark Employers

Effective November 18, 2012 based on a newly enacted Ordinance, employers of 5 or more employees who employ persons — or take applications for employment — in the City of Newark are generally prohibited from (1) conducting pre-application criminal background checks and inquiries and (2) denying employment based on the results of a criminal background check conducted post-offer unless the employer first conducted an individualized analysis of the criminal background using factors listed in the new Ordinance. An employer may discuss an applicant’s criminal background pre-offer if the applicant discloses his/her criminal history voluntarily and without solicitation. There exist some exemptions from the Ordinance, such as mandatory state and federal regulations requiring an employer to consider a criminal history for hiring decisions.

Requirements to Conduct Criminal Background Checks

An employer may not inquire about an applicant’s criminal background pre-offer unless it has made a “good faith determination that the relevant position is of such sensitivity that a criminal history inquiry is warranted.” If an employer conducts a criminal background check on an applicant post-application after a conditional offer has been made, the employer must provide the applicant prior notice and obtain an authorization to conduct the check (similar to an employer’s requirement under the state and federal Fair Credit Reporting Act). The notice also must inform the applicant that he/she will be afforded the opportunity to present evidence regarding the accuracy and relevance of the background check results.

Permissible Consideration by Employer

An employer may inquire about (1) convictions for up to 8 years from sentencing; (2) disorderly persons convictions or municipal ordinance violations for up to 5 years from sentencing; and (3) pending criminal charges (including cases continued without a finding prior to a dismissal). Certain exceptions exist for violent crimes.

Prohibited Actions

Employers may not inquire about, require a candidate to disclose or take any adverse action based on: (1) an arrest or criminal accusation not currently pending; (2) records which have been erased, expunged or subject to an executive pardon; and (3) a juvenile adjudication of delinquency or records which have been sealed.

Required Analysis to Use Criminal History for Hiring Decisions

An employer must consider the following factors when basing a hiring decision on a criminal background:

  • The nature of the crime and relationship to the duties of the position;
  • Information pertaining to the degree of rehabilitation and good conduct;
  • Whether the job provides the applicant the opportunity to commit a similar offense;
  • The length of time that elapsed since the offense; and
  • A certificate of rehabilitation issued by a state or federal agency.

The employer is required to document its analysis of these factors using an “Applicant Criminal Record Consideration” form.

Notification to Applicant and Opportunity to Review Decision

If an employer makes a hiring decision based on an applicant’s criminal record history, it must notify the applicant of the rejection, provide the applicant a copy of the criminal record inquiry and a copy of the Applicant Criminal Record Consideration form. The employer also must state the reason for the adverse decision and include consideration of the factors listed above. Finally, the employer must advise the applicant of the opportunity to review the decision and the manner for the applicant to present evidence relevant to the employer’s consideration. The applicant has 10 days from receipt of the notification to respond. If an applicant timely responds, the employer must consider the applicant’s evidence prior to making a final decision. The employer must document the evidence received from the applicant as well as its final decision and notify the applicant of the final decision in a reasonable amount of time following receipt of the applicant’s evidence.

It remains to be seen how the new law will be enforced. For now, the Mayor of Newark is authorized to create an office of agency to implement and enforce the Ordinance. Penalties will range between $500 to $1000 per violation. However, the Ordinance does not address whether there exists a private right of action to enforce it.

These obligations will require employers to re-visit their background check procedures and hiring guidelines with regard to criminal backgrounds. It will take time to see how the Ordinance impacts the local economy of Newark.

For assistance with matters involving employee notices and criminal background checks, please contact an attorney in the Gibbons Employment & Labor Law Department.

Mitchell Boyarsky is a Director in the Gibbons Employment & Labor Law Department.