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NJ Mandates Severance for Mass Layoffs

WARNing! NJ Mandates Severance Pay for Mass Layoffs.

New Jersey continues to enact new laws to protect employees and restrict employers in the state, most recently passing legislation this month requiring employers of 100 or more employees to (1) provide 90 days’ notice (up from 60 days) and (2) pay one week of severance per year of service to employees who lose their jobs through a mass layoff or termination impacting 50 or more employees.

The law is said to be the first in the country to mandate that employers provide severance pay in the event of a mass layoff or termination. Governor Phil Murphy signed the law into effect on January 21 and it takes effect 180 days after, in July of 2020.

The law applies only to places of employment that have been in the state for at least three years. It covers workers who have been employed with the employer for at least 90 days, and does not cover temporary, part-time (defined as those who work less than 20 hours per week), and supervisory/managerial employees.

Employers that fail to provide the 90 days of required notice of the termination or layoff must provide an additional four weeks of severance pay to each employee.

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