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A 2019 law that significantly enhanced employer penalties for wage and hour law violations cannot be applied retroactively to violations that occurred before the law was signed, according to a state Supreme Court ruling in a case that represents a win for New Jersey businesses. 

NJBIA served as amicus on the case, Maia v. IEW Construction Group, and was represented by attorney Thomas Doherty, a partner at McCarter & English in Newark. 

In overturning an appellate court decision, the New Jersey Supreme Court ruled the Legislature had not intended for its 2019 amendments beefing up penalties in state wage and hour laws to be retroactive to violations that occurred before the amendments took effect on Aug. 6, 2019. 

“We are gratified by the New Jersey Supreme Court’s ruling today in favor of the employer in this putative class action,” Doherty said in a statement issued after the ruling on Wednesday. 

“Applying that legislation to pre-enactment conduct would have been quite unfair – if not unconstitutional – because it would have exposed employers to significant new legal consequences (e.g., a new liquidated/treble damages remedy) for already-completed actions without advance notice of that future exposure and without any clear evidence that the Legislature ever intended retroactive application,” Doherty said. 

NJBIA Vice President of Government Affairs Elissa Frank thanked McCarter & English for its efforts on behalf of New Jersey businesses in this case. 

“Thanks to the efforts of our attorneys, New Jersey businesses will not be bound by an unfair legal standard that was never the Legislature’s intent,” Frank said. “This Supreme Court decision is clearly a win for businesses.” 

The case stems from a class action complaint filed in 2022 by a construction worker who alleged his former employer had failed to pay him for pre- and post-shift work done between May 2019 and November 2021, when he was laid off. 

A trial court originally ruled the enhanced penalties and remedies contained in the 2019 amendments to state wage laws only applied to violations after Aug. 6, 2019, when the amendments took effect. Conduct that occurred during the three months prior to the law’s effective date was not subject to the law’s provisions, the trial court held. 

In 2023, an appellate court later overturned the trial court decision, setting the stage for the Supreme Court ruling this week that was welcomed by the business community. 

The defendant, IEW Construction Group, was represented before the Supreme Court by attorney Michael J. Riccobono of Ogletree, Deakins, Nash, Smoak & Stewart.