On February 4, 2019, New Jersey Governor Phil Murphy signed into law legislation, available here, which gradually raises the minimum wage in New Jersey to $15 per hour by the year 2024 for many workers in New Jersey. Under this law, for employers with more than six employees, the current New Jersey statewide minimum wage of $8.85 will incrementally rise to $15 per hour as follows:
|Date of Increase||Minimum Wage Amount|
|July 1, 2019||$10 per hour|
|January 1, 2020||$11 per hour|
|January 1, 2021||$12 per hour|
|January 1, 2022||$13 per hour|
|January 1, 2023||$14 per hour|
|January 1, 2024||$15 per hour|
Once the minimum wage reaches $15 per hour in 2024, it will continue to increase based on the consumer price index for all urban wage earners and clerical workers (CPI-W), as calculated by the federal government.
In enacting this law, New Jersey joins California, Massachusetts, New York, and the District of Columbia that have adopted a $15 per hour minimum wage.
Certain sectors of the workforce, such as seasonal workers, employees at small businesses and farmworkers, will have to wait longer to reach the $15 threshold. For instance, employees of small businesses (i.e., a business with five or fewer employees), will see their minimum wage reach $15 an hour in 2026. Tipped workers, who currently have a minimum wage of $2.13 per hour, are scheduled to see an increase to $5.13 an hour by 2024.
In light of the enactment of this new law, employers in New Jersey should closely monitor their payroll practices to ensure that they are complying with the new minimum wage requirements and that they take such minimum wage increases into consideration when calculating overtime pay and spread of hours pay earned by their nonexempt employees.
* Jamie Moelis, a law clerk, assisted in the preparation of this blog.