Compliance with employment regulation can be challenging for any company but it is particularly onerous on small businesses which typically spend a greater percentage of their revenue keeping up. Regulations are imposed by the federal government, state governments and sometimes local municipalities. It can be a process to understand which laws apply to employment issues as they arise. That process just became easier.

On September 6, 2011 the New Jersey Department of Labor and Workforce Development adopted new regulations on overtime payments to employees. The new regulations will make New Jersey’s overtime standards consistent with federal regulations. The new consistency in the treatment of overtime will make it easier for businesses to comply and make it easier for companies that do business in multiple states.

Previously New Jersey law was similar to federal law in that there was a requirement of employers to pay employees minimum wage for the first forty hours worked, and to pay overtime for all hours worked over forty. Additionally, both laws provided exemptions for individuals employed in an administrative, executive, professional or outside sales capacity. The differences were along the lines of job duties and actual time spent working on exempt activities versus non-exempt activities. Even with just one set of laws to interpret, answers can seem more of a gray than a black or white.

Let’s examine a real life example. Earlier this month four US Open umpires filed a lawsuit claiming that the U.S. Tennis Association failed to pay them overtime during the three week tournament in violation of federal and state law. The Umpires allege that they regularly work more than forty hours in a week during the tournament, but do not receive overtime pay. So is umpiring an exempt activity? That is probably a secondary issue. First the court will need to decide if a three week stint even counts as an employment relationship or is it more appropriately a classified as a subcontractor relationship not subject to the employment laws. Different regulations and more gray area. Stay tuned.

As for now the New Jersey Department of Labor deserves credit for simplifying their overtime rules and following the federal law.

If your company is facing uncertainty with employment regulation, know that you are not alone. A local labor law attorney can be a valuable ally. Please call our office if you would like a referral.