• New Jersey Legislature Passes Paid Family Leave Law
  • April 21, 2008
  • Law Firm: Pepper Hamilton LLP - Princeton Office
  • Governor Jon Corzine is poised to sign legislation that will make New Jersey the third state to mandate that employers provide paid leave to employees who request time off to care for a newborn or newly adopted child or a sick family member. Although payroll deductions to fund the plan do not begin until January 1, 2009, and family leave benefits are not available until six months later, New Jersey employers need to plan now for the effects of this new law.

    The new legislation, which received final legislative approval on April 7, 2008, extends New Jersey’s temporary disability insurance (TDI) system, which presently provides wage insurance for employees’ own disabilities, to provide workers with up to six weeks paid family leave benefits in two additional circumstances. First, parents may take paid leave to “be with a child during the first 12 months after the child’s birth ... or the first 12 months after the placement of the child for adoption with the [parent].” Second, workers may take leave to “participate in the providing of care... for a family member of the individual made necessary by a serious health condition of the family member.” A “serious health condition” is defined as “an illness, injury, impairment or physical or mental condition which requires: inpatient care in a hospital, hospice, or residential medical care facility; or continuing medical treatment or continuing supervision by a health care provider,” which is consistent with that term’s definition in New Jersey’s existing Family Leave Act.

    While the Family Leave Act already permits employees to take up to 12 weeks unpaid leave to care for a new baby or a seriously ill family member, the new legislation enables workers to be paid a portion of their wages (two-thirds of their regular weekly wage, up to $524 each week) for up to six weeks of that leave. Unlike the Family Leave Act (and the federal Family and Medical Leave Act), which apply only to employers with 50 or more employees, all New Jersey employers must participate in the state’s paid family leave program. The new legislation does not, however, extend the job restoration requirement to employers of fewer than 50 employees. The legislation states explicitly that an employee shall have no action for wrongful discharge or other violation of law or public policy if he or she is not restored to employment after a leave.

    The new program will be funded through worker payroll deductions that lawmakers estimate will cost employees $33 annually. More important for employers, however, is the practical effect that this legislation will have on employers attempting to find replacement workers for up to a six-week period. Although larger employers currently deal with this issue under the Family Leave Act, the paid leave is likely to encourage employees who might not otherwise take advantage of - or who are ineligible for - unpaid family leave to opt out of the workforce for a time to care for a loved one. Given the likely increase in extended leave situations, employers should examine their current practices for managing employee absences. Potential strategies for mitigating the disruption include increasing cross-training so other employees can more easily perform an absent colleague’s job duties and implementing policies that encourage employees to provide ample advance notice of an intent to take family leave. Although workers cannot take paid family leave until July 2009, it is never too early to adopt these beneficial workplace measures.