Employers Beware! A Private Cause of Action Exists for Unpaid Overtime
U.S. District Judge Kevin McNulty, of the District of New Jersey, has addressed an issue of first impression in New Jersey: Does a private cause of action exist under the New Jersey Wage and Hour Law (our State’s analog to the federal Fair Labor Standards Act) for unpaid overtime? On May 22, 2015 Judge McNulty in Thomas v. Real Estate Mortgage Network Inc., et. al. ruled the New Jersey Wage and Hour Law does provide an express right to recover not just unpaid wages, but unpaid overtime as well.
While prior cases in our state have been decided on the premise that a private cause of action for unpaid overtime exists, no court has directly addressed whether such a right exists, until now.
Relying in part on the recently decided Supreme Court case Hargrove v. Sleepy’s, Judge McNulty ruled that the New Jersey Wage and Hour Law is designed to protect employees not just from unpaid wages but excessive hours as well. Judge McNulty relies, in part, upon the law’s limitation section which specifically referenced not just unpaid wages, but unpaid overtime compensation, to support his ruling that the legislatures intended the law to apply to unpaid overtime as well.
At the heart of this recent decision was the misclassification of workers, whose positions had been improperly classified as exempt from overtime. Employers should ensure that all exempt positions do in fact meet the test for exemption.
Contact Deena B. Rosendahl, Esq. at 201-947-8855 or Drosendahl@northjerseyattorneys.com to ensure your pay practices comply with the New Jersey Wage and Hour Law and your employees are properly classified.