New Jersey will soon be one of the first states to have an equal pay law that extends beyond gender to all classes of employees that are protected under the state’s antidiscrimination law. Governor Murphy is about to sign the Diane B. Allen Equal Pay Act, which makes it unlawful for an employer to compensate employees of a protected class less than employees that are not in that class for “substantially similar” work in terms of skill, effort, and responsibility. It will also be a violation of the law for an employer to retaliate against an employee for requesting, discussing with, or disclosing to another employee or his/her lawyer or any government agency, information related to employee compensation. Also, the law prohibits a NJ employer from requiring an employee, as a condition of employment, to sign a waiver or to agree not to make these types of requests or disclosures. The law applies to both public and private employers in NJ.
Q: Under what circumstances will an employer be allowed to pay different rates of compensation to employees for substantially similar work?
A: The employer will have to demonstrate that it has a seniority or merit system in place or, in the alternative, each of the following 5 factors:
As we get closer to the date the Equal Pay Act takes effect, July 1, 2018, employers should identify any problematic pay disparities and, if found, take steps to remedy any differences that could be attributed to membership in a protected class.
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