New Jersey Gov.-elect Phil Murphy New Jersey Gov. Phil Murphy

New Jersey’s new governor, Phil Murphy, has laid out an aggressive legislative agenda on a number of levels. If Governor Murphy’s initiatives are enacted, employers in New Jersey must be prepared for their impact on the workplace. The governor is prepared to move quickly; his very first executive order focused on employment, prohibiting state agencies from asking job applicants about their salary histories.

One of the new governor’s campaign promises was to raise the state’s minimum wage to $15 per hour. Currently, New Jersey’s minimum wage stands at $8.60 per hour. Former Governor Christie vetoed a bill providing such a wage hike in 2016. Now, with a Democratic governor and a Democratic legislature, some expect smooth sailing toward a minimum wage hike. However, recent reports reveal there are disagreements between the governor and legislative leaders over the scope of potential increases. One question is whether the wage hikes would apply to all employees, which Governor Murphy has said he supports, or will have carve outs, for example for teenage workers. That said, it can be reasonably anticipated that a bill, in some form, will in the near future make it to the governor’s desk. Once this occurs, employers whose employees work at or near the minimum wage will need to make necessary adjustments to their business plans. To cushion the impact, it is likely that any minimum wage law will provide for gradual implementation, rather than a dramatic immediate increase to $15 per hour.

Another one of Governor Murphy’s highly publicized initiatives is the legalization of recreational marijuana. A number of states (nine, at last count) have already done so. While there is significant press coverage surrounding the passage of these laws, the impact on the employment front has been minimal because marijuana remains illegal under federal law. Moreover, most states passing marijuana legalization laws do not require employers to accommodate its use. Therefore, courts have consistently upheld terminations based on employee drug tests detecting marijuana, even where it was purportedly being used for medical reasons. It is possible that New Jersey will be one of the first states to include an accommodation requirement for medical marijuana use as part of the legalization initiative. If that happens, the impact will be more significant. Regardless, employers are well-advised to carefully review their drug and alcohol policies to ensure their compliance with the law, and modify them accordingly if the law changes.

Governor Murphy has also pledged to combat the opioid crisis, just as Governor Christie did in his last year in office. Governor Murphy has promised to increase the number of drug treatment beds, and to require insurers to cover medication-assisted treatment for opioid addiction. This is one area where employers may be significantly affected. The New Jersey Law Against Discrimination (NJLAD) protects individuals who have disabilities, and requires employers to provide them with reasonable accommodations. Drug addiction can be a disability under the NJLAD. Employers do not have to modify work rules or excuse violations to accommodate employees under the influence of drugs at work, provided the work rules are consistently enforced. However, the more common scenario is that an employee will request time off from work to attend drug treatment. Such requests will likely be more frequent if Governor Murphy’s promises become law, especially if insurance coverage expands. Therefore, employers need to be prepared when faced with requests for time off to attend treatment. Employers are cautioned that it is the employer who must prove a requested accommodation would be an undue burden if a denial is challenged. Employers covered by the Family and Medical Leave Act (FMLA) may be required to provide leave to eligible employees for treatment for substance abuse regardless of the impact of the leave on the business.

On that same front, Governor Murphy has pledged to make statewide paid sick leave a top priority. While he has not laid out any concrete plans for how paid sick leave will work, a number of New Jersey municipalities, starting with Newark in 2014, have already adopted paid sick leave ordinances. These municipality-specific ordinances allow covered employees to accrue paid time off based on the number of hours they work. This is a roadmap that any statewide legislation might be expected to follow. Again, if a statewide paid leave law is passed, employers will need to modify their leave policies to comply, and any such law will likely add an additional layer to a company’s disability accommodation process. Employers who have processes already in place to deal with existing federal and state unpaid leave laws should be able to pivot quickly, but if any new paid sick leave law covers smaller companies unfamiliar with these processes, they will likely face challenges.

Employment law is constantly evolving, and Governor Murphy has pledged to be a change agent in this regard. If he fulfills that pledge, the evolution will accelerate. It is highly recommended that employers follow the expected (and unexpected) changes closely, so that they can make educated decisions if and when employment-specific bills become laws.

 

Lichtenberg is a partner at the New Jersey office of Fisher Phillips in Murray Hill. His practice focuses on employment litigation, counseling and management training.