In the years since the #MeToo movement emerged, there is no question that the culture surrounding sexual harassment in the workplace as it relates to employment law and discrimination, as well as retaliation has completely transformed. This includes the culture here in New Jersey, where new state and federal legislation has changed in an effort to better protect victims of sexual harassment in the workplace.
The Ability for Employers to Deduct Certain Business Expenses
The Internal Revenue Code was altered to prohibit employers from deducting business expenses related to any nondisclosure provisions in settlement agreements that are related to payments related to sexual harassment or abuse, including attorneys’ fees connected to these payments/settlements. However, while the adjustment is a good faith attempt to prevent employers from shielding wrongdoers, it still fails to cover some key areas, such as defining “sexual abuse” and “sexual harassment,” as well as addressing how settlements related to concerning claims outside of sexual harassment will be treated.
State Equal Pay Act
New Jersey also passed the “Diane B. Allen Equal Pay Act,” which not only applies to pay gaps based on gender, but also all other protected classes, including age, race, and others. The law enables an affected worker to bring a claim alleging that someone else engaged in “substantially similar work” is being paid more than they are in violation of the law. In addition, the law prevents employers from reducing the wages of the employee who is being paid more as a result, and instead forces the employer to raise the compensation of the underpaid employee. However, the concept of “substantially similar work” has been left somewhat ambiguous. In addition, the law carves out exceptions that allow for employers to engage in pay disparities based on a number of factors, including:
- Seniority; and/or
- The quality and quantity of production.
If any of these factors are found to apply, the employer must then demonstrate that:
- The factor is not based on – nor does it perpetuate – a “differential in compensation” based on a protected characteristic;
- Each factor has been reasonably applied;
- One or more factors account for the entire wage differential; and
- The factors are job-related and based on a legitimate business necessity, which is unavoidable; where there are no alternative options available.
No Arbitration Clauses or Non-Disclosure Agreements When it Comes to Discrimination, Harassment, or Retaliation
New Jersey has also prohibited employers from including mandatory arbitration clauses and nondisclosure provisions in any employment contracts and settlement agreements that involve discrimination, harassment, or retaliation and renders unenforceable any nondisclosure provision in an employment or settlement contract that conceals all of the details relating to a claim of discrimination, harassment, or retaliation. In other words, the law appears to prohibit employers from including provisions that will waive an employee’s right to go to trial. Still, it is possible that, if taken to court, this particular provision could be reversed due to potentially contradicting the Federal Arbitration Act.
There are also a number of pending initiatives that have been proposed, including one requiring New Jersey restaurants to adopt anti-harassment training policies and another that would mandate that a number of public companies throughout the state have at least three women on their corporate boards by the year 2021.
Contact Our New Jersey Employment Law Attorneys to Find Out More
There are, indeed, a number of important recent changes when it comes to employment law here in New Jersey. If you have experienced sexual harassment or gender discrimination, the New Jersey sexual harassment lawyers at McOmber & McOmber, P.C. can help you. Please call our Red Bank office at 732-842-6500, our Marlton office at 856-985-9800, OR contact us at 888-396-0736 or online for a free consultation.