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What NJ Employers Should Know About New Jersey Overtime Laws

by | Feb 5, 2018 | Uncategorized

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Having your own business can be a rewarding endeavor and a step that many people dream about. But the rules about paying employees are not always clear. For example, if a worker works more than a 40 hour work week, is he/she automatically entitled to overtime? Let’s say you own a business and your secretary, who is a salaried employee, has been working really long hours, well beyond the standard. Is she entitled to overtime?

GENERAL OVERTIME RULES

New Jersey State Wage and Hour Law (NJSWHL) mandates that an employer must pay overtime to eligible employees. If an employee works more than 40 hours a week, he is entitled to overtime, meaning you should be paying him at least his hourly rate plus an additional 50% for the amount of time over 40 hours that he works. But this general rule does not apply to every job or every employer.

OVERTIME EXCEPTIONS

New Jersey specifically exempts “executive, administrative, and professional employees who are paid on a salary basis,” often known as “white collar workers.” There are certain characteristics required by law to fit within this exemption. For example, an executive employee must regularly direct the work of multiple full-time employees and manage his own primary work function; an administrative employee must partake in non-manual, office work related to management policies or traditional business operations; and a professional employee must constantly exercise discretion and judgment and perform work that is primarily eclectic and intellectual and cannot be standardized for any given timeframe in order to fall within the exemption.

PAID TIME OFF NOT A SUBSTITUTE

Paid time off is not an adequate substitute for overtime hours in private company environments. This means, you cannot give an employee paid vacation time for working overtime. They cannot essentially earn a vacation by working overtime. This is only true for private companies in New Jersey and those that work for the New Jersey government can be offered this as an option.

BREAKS DURING THE WORKDAY

New Jersey law also does not require lunch breaks or rest breaks. But, if an employee works during either a lunch or rest break, he is entitled to be paid for that time. A secretary who answers phones during her lunch break is therefore entitled to be paid for that period of time. A short break, anywhere from five to twenty minutes, is generally not considered a true “break” and is considered part of an employee’s workday.

STATE AND FEDERAL LAWS

There can sometimes be discrepancies between federal and state employment laws. The federal law is the Fair Labor and Standards Act (FLSA). If the FLSA and NJSWHL require different action, an employer is obligated to apply the law which is more beneficial to the employee.

Be sure to reach out to an attorney if you have any questions.

Angela Yu is a New Jersey and New York attorney with a multifaceted practice area focusing in corporate, real estate and general contract law. She uses her interest in real life application of the law to author articles and other scholarship on a broad range of cutting-edge legal and business topics. Ms. Yu is a published legal author and holds a J.D. and M.B.A. from Rutgers School of Law and Rutgers Business School. Neither she nor Mike Farhi provides legal advice on this website. This blog post and any blog posts do not constitute legal advice.

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