United States: Top New Jersey Legal Developments: Trends In New Jersey Employment Law – 2013 Year In Review

2013 was a busy year for employment law in New Jersey. This newsletter summarizes noteworthy developments in ten key areas—social media, the Law Against Discrimination ("LAD"), whistleblowing, background checks, drug and alcohol policies, employee leave, arbitration, non-competes, wage & hour, and Title VII of the Civil Rights Act of 1964 ("Title VII").

Social Media

Statutory Developments

New Jersey has a new law that forbids employers from requiring or requesting that prospective or current employees disclose user names and passwords to their personal social media accounts. The law also provides employees with expansive protections against retaliation. An employer may not require employees to waive their rights under the statute.

Despite these prohibitions, an employer may:

  • implement and enforce a policy pertaining to the use of employer-issued communications devices, accounts or services used for work-related purposes;
  • conduct an investigation based on the receipt of specific information about activity on an employee's personal social media account (1) to ensure compliance with laws, regulations or prohibitions on work-related misconduct, or (2) to prevent the employee's unauthorized transfer of the employer's proprietary/confidential or financial information; or
  • access, view or utilize information about a current or prospective employee in the public domain, as well as otherwise comply with existing statutes, regulations, rules, or case law.

The new law does not provide a private right of action; rather, for non-compliance, an employer is subject to a modest fine of no more than $2,500. Nevertheless, there is concern that employers which engage in the type of conduct the new law prohibits may violate common law privacy rights or the Conscientious Employee Protection Act ("CEPA") and incur damages in court.

Employers doing business across the country should note that 11 other states have granted similar social media protections by statute. For more information on the New Jersey law and this emerging national trend, please see our client alert.

Judicial Developments

A recent federal case highlights other possible forms of liability for New Jersey employers who access or monitor the personal social media accounts of their applicants or employees. In Ehling v. Monmouth-Ocean Hospital Service Corp., No. 2:11-cv-03305 (WMJ), 2013 WL 4436539 (D.N.J. Aug. 20, 2013), an employer (defendant) suspended an employee (plaintiff) for posting offensive comments on her Facebook page. The defendant learned of the post from another employee who was one of the plaintiff's Facebook friends. The plaintiff filed suit, alleging violations of her common law privacy rights and the Stored Communications Act ("SCA"), a federal law that protects against the unauthorized disclosure of electronic communications.

The court granted summary judgment on the common law privacy claim, reasoning that, because the co-worker "voluntarily" disclosed the post, the defendant did not intentionally intrude upon the plaintiff's personal affairs. Moreover, although the court held that the SCA protects non-public Facebook posts, it dismissed the SCA claim, invoking the "authorized user" exception given that the plaintiff granted access to her co-worker who, in turn, freely divulged the post.


Pay Equity Amendment

New Jersey amended the LAD to include a non-retaliation pay equity provision to protect employees who discuss compensation with one another. Under the amendment, an employer may not retaliate against an employee for requesting from another employee, or former employee, information regarding job title, occupational category, and rate of compensation, or the gender, race, ethnicity, military status, or national origin, of any current or former employee, if the purpose of that inquiry is to assist in an investigation into discriminatory treatment regarding pay, compensation, bonuses, other compensation, or benefits. The amendment makes it clear that an employer is not required to release protected information in response to an employee's request, but only prohibits reprisals against any employee who makes such a request.

An aggrieved employee may seek a range of monetary damages and equitable relief under the LAD, and also may try to assert a claim under CEPA for retaliation as a result of objecting to or disclosing violations of the new amendment. For more on the amendment, please see our client alert.

Pay Equity Notice and Poster of Rights

The New Jersey Department of Labor and Workforce Development recently issued a notice in English and Spanish detailing "the right to be free of gender inequality or bias in pay, compensation, benefits, or other terms and conditions or employment" under the LAD, Title VII and Equal Pay Act. No later than January 6, 2014, employers must conspicuously display the notice. Moreover, employers must provide the notice to employees hired after January 6, 2014 immediately upon hire, and to all current employees no later than February 5, 2014. Employers also must provide each employee with the notice upon the employee's first request.

After satisfying the initial distribution requirements, employers must provide the notice to employees annually on or before December 31 of each year (like with CEPA). Employers may distribute the notice via email, print or the internet. When notice is distributed, employees must sign a form to acknowledge receipt, which also is available on the Department's website. For more on the new posting and distribution requirements, please refer to our client alert.

Judicial Developments

The New Jersey Supreme Court recently rendered a significant decision with regard to the LAD. In Battaglia v. United Parcel Service, Inc., 214 N.J. 518 (2013), the court concluded that a plaintiff engaged in protected activity sufficient to support a retaliation claim under the LAD when he allegedly complained about discriminatory comments made about women in the presence of male employees only. Significantly, there was no evidence that the defendant committed "demonstrable acts of [gender] discrimination" against "any particular woman." Thus, according to the Court, even where a plaintiff did not directly witness or experience discrimination or report discrimination against identifiable persons, he or she may qualify for protection under the anti-retaliation provisions of the LAD.


Within the past year, New Jersey federal and state courts have issued important rulings in several whistleblower cases.

New Jersey Supreme Court

In Longo v. Pleasure Productions, Inc., 215 N.J. 48 (2013), the trial judge instructed the jury that it could award punitive damages under CEPA against the employer "to punish defendants who have acted in an especially egregious or outrageous manner." The Supreme Court reversed the lower court's award of punitive damages for failure to include an upper management charge in the jury instructions. Specifically, the Court emphasized that to assess punitive damages under CEPA a jury must conclude that upper management actually participated in, or acted with willful indifference to, the wrongful conduct (which must be especially egregious).

New Jersey Appellate Division

Over the years, several Appellate Division opinions had suggested there was a "job-duties" exception to qualifying as a whistleblower under CEPA, i.e., an employee may not qualify as a whistleblower where the complaint arose from the employee's performance of his or her job duties. In 2013, the Appellate Division issued a decision that went in a different direction. In Lippman v. Ethicon, Inc., 432 N.J. Super. 378 (App. Div. 2013), the Appellate Division concluded that CEPA protection is not necessarily based on an employee's title or the "core functions" of the employee's position. Rather, according to the court, a so-called "watchdog" employee may assert a CEPA claim so long as "he or she either pursued and exhausted all internal means of securing compliance; or refused to participate in the objectionable conduct." This decision concerning the protections afforded to "watchdog" employees could have significant implications.

Third Circuit Court of Appeals

In Wiest v. Lynch, 710 F.3d 121 (3d Cir. 2013), the Third Circuit held that a whistleblower does not have to "definitively and specifically" relate his or her complaint to shareholder fraud to make out a claim under Section 806 of the Sarbanes-Oxley Act ("SOX"). In rejecting the "definitively and specifically" standard, the Third Circuit split from the First, Fifth, Sixth and Ninth Circuits. The Third Circuit also diverged from the Fourth Circuit in holding that communications about a potential violation of Section 806 are protected so long as the employee reasonably believes the violation will occur. Applying these standards, the Third Circuit held that plaintiff's communications about improper business expenditures constituted protected activity. For more on Wiest, please refer to our post on the Proskauer Whistleblower Defense blog.

Background Checks


The New Jersey legislature has introduced the Opportunity to Compete Act (A-3837 and S-2586), which, among other things, would prohibit an employer from inquiring into an applicant's criminal history until after a conditional offer of employment is made. Under the proposed law, an employer who conducts an impermissible criminal inquiry is subject to a several thousand dollar fine. An Assembly committee recently advanced the bill.

Employers operating in other jurisdictions should note that several other states as well as New Jersey municipalities (including Newark) have enacted similar laws as part of a trend known as "ban the box." For more on recent "ban the box" laws, please read our past client alerts.


In 2012, the New Jersey Senate passed a bill (S-455) that would generally prohibit employers from obtaining credit reports on their applicants and employees. An Assembly committee approved the bill (A-2840) in December of 2013 and a vote before the full Assembly can be expected in the near future. Although the proposed law contains several exceptions, it affords generous remedies, i.e., a private right of action and significant fines.

Multi-state employers should remember that ten other states have codified similar statutes, and the U.S. Senate recently introduced comparable legislation. For more on recent credit check bans, please see our past client alerts.

Drug and Alcohol Policies

The Third Circuit issued two notable decisions this past year regarding workplace drug and alcohol policies. In Ostrowski v. Con-way Freight, Inc., No. 12-3800, 2013 WL 5814131 (3d Cir. Oct. 30, 2013), the Court held that an employer did not discriminate against the plaintiff on the basis of his disability (alcoholism) when it terminated him for violating a return-to-work agreement (RWA) that prohibited the consumption of alcohol. The Third Circuit held that the plaintiff could not state a claim of discrimination because the RWA did not preclude disabled employees (i.e., alcoholics) from working for Con-way, but merely regulated their conduct (i.e., drinking alcohol). For more on the Ostrowski decision, please see our client alert.

And, in Reilly v. Lehigh Valley Hospital, 519 F. App'x 759 (3d Cir. 2013), the Third Circuit affirmed that an employer did not discriminate on the basis of the plaintiff's disability (drug addiction) when it fired him for lying about his history of narcotics addiction on a pre-employment questionnaire.

Employee Leave

Domestic Violence Leave

Joining a number of other states, New Jersey now provides employees affected by domestic or sexual violence with up to 20 days of unpaid leave. Should an employer discriminate or retaliate against an employee or otherwise deny an employee his or her rights under the law, the employer may be subject to a suit in court, as well as a fine ranging from $1,000 to $5,000. Employers must post a notice of employee rights, which is available on the New Jersey Department of Labor and Workforce Development's website, and use other "appropriate means" to keep employees informed. For more information on the law, please refer to our client alerts on the substantive provisions and posting requirements.

Sick Leave (Jersey City only)

As of January 24, 2014, Jersey City employers with 10 or more employees must provide paid sick leave, while employers with fewer than 10 employees must provide unpaid sick leave. Leave accrues at a rate of one hour of paid time for every thirty hours worked, up to a maximum of forty hours of leave in a calendar year. The law contains expansive anti-retaliation protections and a private right of action; employers also face fines of up to $1,250. Furthermore, Jersey City employers must remember to abide by the posting and distribution requirements set forth under the new ordinance.

By enacting this law, Jersey City followed the lead of several other municipalities around the country with sick leave laws. Newark also is considering a similar ordinance, which is likely to become law. For more on the Jersey City ordinance, please see our client alert.


In Cole v. Jersey City Medical Center, 215 N.J. 265 (2013), the New Jersey Supreme Court adopted a seven-factor inquiry into whether an employer waived its right to compel arbitration. This test considers (1) any delay in making the arbitration request; (2) the filing of any motions, particularly dispositive ones; (3) whether the delay is part of a litigation strategy; (4) the extent of discovery conducted; (5) whether the party raised arbitration in the pleadings or gave other notice of intent to seek arbitration; (6) the proximity of the date on which the arbitration was sought to the trial date; and (7) any resulting prejudice suffered by the other party. Employers should take note of these factors if they seek to compel arbitration.

Covenants not to Compete

The New Jersey Assembly proposed a bill (A-3970) that would invalidate any agreement not to compete, not to disclose, and not to solicit between an individual eligible to receive unemployment benefits and his or her most recent employer. Notably, the bill only would invalidate restrictive covenants entered into after its enactment. Given the current political landscape, it appears unlikely that the legislation will become law.

Wage and Hour

Minimum Wage

New Jersey voters overwhelmingly approved a constitutional amendment to increase the minimum wage from $7.25 to $8.25 per hour as of January 1, 2014. The amendment further provides that the minimum wage will be adjusted automatically based on the Consumer Price Index on an annual basis, beginning on September 30, 2014 and taking effect every January 1 thereafter. Please refer to our client alert for more on the amendment.

Unpaid Interns

The New Jersey Senate introduced a bill (S-3064) to protect unpaid interns from employment discrimination by amending LAD, CEPA and the Worker Freedom from Employer Intimidation Act ("WFEIA"). Should the proposal become law, unpaid interns could seek a range of legal or equitable remedies, including compensatory and punitive damages, reinstatement and attorney's fees. Although Oregon is the only state to have enacted such a law, the New York Senate introduced similar legislation and there are rumblings that California may do the same. For more on the New Jersey bill and this emerging trend, please see our client alert.

Title VII

In Mariotti v. Mariotti Building Products Inc., 714 F.3d 761 (3d Cir. 2013), the Third Circuit held that an individual who was a shareholder, officer and director of a closely held corporation was not an employee under Title VII. Following the lead of the United States Supreme Court and the First Circuit, the Third Circuit concluded that the plaintiff did not qualify for protection under the statute because, given his authority and right to control the enterprise, he was not the "kind of person that common law would consider an employee."

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.