HR Alerts

July 2026

Governor Sherrill signed a new law creating an annual assessment on employers with 50 or more employees enrolled in State Medicaid. An employer is subject to the assessment if it employed 50 or more workers who received State Medicaid coverage at any point in the prior calendar year. The law counts both employees and their Medicaid-enrolled dependents toward the fee. The purpose of the fee is to raise revenue to defray State Medicaid cost, with an estimated net revenue increase of $154.1 million in FY 2027 alone. The law became effective July 1, 2026.

The Fee Structure

The assessment is billed per enrolled employee and per enrolled dependent, based on total Medicaid enrollment tied to the employer:

$325 per person for employers with 50 to 249 enrolled
$525 per person for employers with 250 to 499 enrolled
$725 per person for employers with 500 or more enrolled

The state will notify employers by March 1 each year based on enrollment as of the prior December 31. Payment and any required filings are due April 15, submitted electronically to the Division of Revenue and Enterprise Services.

Exclusions

The law exempts employees and dependents with a developmental disability, intellectual disability, or permanent physical disability, as defined under existing state statutes.

Starting July 1, 2027, three additional categories are excluded:

• Employees on the job less than 90 days at the time the fee is calculated
• Part-time, per diem, or temporary employees
• Seasonal employees

If an employer is charged for someone who would qualify for one of these three exclusions before the 2027 start date, the law provides a credit against future liability, or a refund if there is no offsetting liability, in the following year. The employer bears the burden of proving eligibility for the exclusion.

Penalties and Appeals

Unpaid fees carry a penalty of up to $500 per day, per affected employee or dependent. Employers can appeal an assessment through the Department of Labor and Workforce Development, with further appeal available to the Appellate Division. The fee itself must still be paid while an appeal is pending; only the refund, not any penalty already paid, is recoverable if the employer wins.

The commissioner also has audit authority and can require employers to produce books and records tied to the assessment.

Nondiscrimination and Confidentiality Requirements

Employers cannot use an applicant’s or employee’s Medicaid enrollment status as a basis for hiring, firing, or promotion decisions. Individually identifiable Medicaid enrollment data collected for this program is confidential, exempt from OPRA, and restricted to official use.

July 2026

The New Jersey Division on Civil Rights has updated its NJ Family Leave Act (NJFLA) Fact Sheet and Frequently Asked Questions (FAQ) document to reflect the law’s revised employer coverage threshold and employee eligibility requirements.

Updates include:

• Employer coverage threshold of 15 or more employees
• Employee eligibility after 3 months of employment and 250 hours worked

The updated resources are available on the NJFLA Resources page.

Please note that the Temporary Disability Insurance (TDI) and Family Leave Insurance (FLI) posters have not yet been updated. EANJ will provide additional updates as soon as revised versions become available.

July 2026

The legislation that expanded the NJ Family Leave Act (NJFLA) also created a new, separate job protection right tied to Temporary Disability Insurance (TDI) and Family Leave Insurance (FLI) benefits.

Beginning on July 17, employees on unpaid leave who are collecting TDI or FLI benefits get job protection even where NJFLA and the federal Family Medical Leave Act (FMLA) don’t apply. This includes workers already collecting these benefits, even if their leave began before July 17.

The New Jersey Department of Labor and Workforce Development (NJDOL) recently published FAQs for employers and workers that confirm the basics but leave open critical issues.

No size threshold. No tenure requirement.

TDI/FLI eligibility is based on earnings in covered employment.  In 2026, an employee must earn at least $310 per week over 20 weeks or have earned a combined total of $15,500 in base year wages. Once an employee qualifies for benefits and their FMLA or NJFLA protection, if any, is exhausted or unavailable, the job restoration obligation applies regardless of how many people you employ or how long the employee worked for you.

The complaint process isn’t built yet, and its scope is still unclear.

The worker FAQ states that a worker can file a lawsuit in Superior Court or submit a complaint to NJDOL, but the NJDOL intake form has not yet been developed. The employer FAQ doesn’t address enforcement at all, so employers have no indication of what NJDOL will do once a complaint is filed. Will they investigate? Issue findings? Order reinstatement? None of that is defined yet, and we’ll share an update as more details become available.

Employers should assume eligibility while a claim is pending.

While an application for benefits is pending, the FAQ guidance advises employers to assume approval and protect the job until told otherwise. NJDOL mails employers a DS-7C notice when TDI benefits are approved, though it can take weeks or months to arrive, and it shows only which weeks were paid rather than the approved leave duration or any extensions granted.  The FAQs don’t address how or when FLI claims are communicated to employers.

Given that gap, employers should consider a process going forward of asking the employee to confirm benefit status and expected duration at reasonable intervals, and keeping a record of those requests. That documentation can provide a clearer picture of where things stand while the state’s notification process catches up.

PTO can supplement TDI/FLI benefits, with one exception.

Employers can supplement TDI/FLI benefits with PTO, including from a general bank provided the PTO policy isn’t also being used to satisfy NJ Earned Sick Leave Law obligations. If a PTO bank is used for Earned Sick Leave Law compliance, it cannot be used to supplement TDI/FLI benefits.

NJFLA coverage is also expanding.

More workers will now qualify for job protection under the NJFLA as the employer coverage size threshold is dropping from 30 employees to 15 employees, and employee eligibility will kick in after 3 months of employment and 250 hours worked.  As of the time of this publication, the Division on Civil Rights (DCR), which oversees NJFLA enforcement, has not yet issued updated guidance on this expansion.

EANJ members can access our updated NJFLA model policies here.

EANJ’s efforts

EANJ reached out to several hundred employers across the state, spanning a range of industries and business sizes, to assess the impact of these considerable amendments. As a result of our outreach, in-depth meetings were held with approximately 100 of those businesses to understand specific compliance and operational concerns.

Based on that outreach, EANJ continues to work with our legislators to enact a cleanup bill that adds an undue hardship exception to reinstatement, requires coordination with FMLA/NJFLA, and creates real-time employer notice communications from the NJDOL, among other things. That will take time and, in the meantime, the best approach for employers is to comply with the substantive obligations of these amendments and document your efforts, the circumstances and the actions you’re taking.  As we continue to work with our legislators, we encourage you to reach out directly to EANJ with your continued concerns.

July 2026

New Jersey Department of Labor & Workforce Development has published guidance regarding expanded job protection tied to TDI/FLI beginning on July 17^th.

• General Information
• List of Employer FAQ’s
• List of Employee FAQ’s 

As of this morning, the NJ Division on Civil Rights has not yet updated their website with resources regarding the expansion of NJFLA.

EANJ is continuing to meet with State lawmakers regarding the many outstanding issues surrounding this expansion.

May 2026

New Jersey has finalized regulations under its ABC test for independent contractor classification, with the rules taking effect October 1, 2026.

The ABC test has long governed how NJ employers determine whether a worker is an employee or an independent contractor, but the finalized regulations now codify and clarify how that test applies across three key statutes: the Unemployment Compensation Law, the Wage and Hour Law, and the Wage Payment Law. That coverage matters because misclassification exposure under those laws can include back wages, tax assessments, and penalties.  Employers bear the burden of satisfying all three prongs, and the NJDOL has signaled it will look at the real substance of working relationships, not just contracts or paperwork.

The NJDOL revised the final rules in response to significant business community feedback, pulling back on some of the more expansive provisions in the original proposal. Still, employers who use independent contractors should treat the October effective date as a deadline to review current arrangements.

EANJ members can read more here

March 2026

On January 13, 2026, New Jersey approved P.L.2025, c.325, which amends the Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (CREAMMA). The amendment does not overhaul the law but does significantly change important elements of the law that relate to assessing employee impairment, determining which substances qualify as intoxicating “cannabis items,” and, for cannabis employers, conducting employee background checks.

Changes to the Workplace Cannabis Impairment Evaluation Process

The amended statute changes how employers evaluate potential cannabis impairment during work hours. Previously, the Cannabis Regulatory Commission (CRC) had asserted its intent to partner with the NJ State Police to develop a process to train and certify “full- or part-time employees, or others contracted to perform services on behalf of an employer” to serve as “Workplace Impairment Recognition Experts” (WIRE) within an organization. With the amendment, the CRC will instead work in consultation with the NJ Department of Labor and Workforce Development (NJDOL) to create those same standards for individuals to be certified as a “Workplace Impairment Recognition Evaluator.”

When completed, the CRC’s certification process will determine the standards both for the WIREs and the third-party organizations which train them. CREAMMA requires the CRC to establish minimum curriculum standards for third party organizations which seek to offer WIRE certification training. The statute makes clear that WIRE training is intended to prepare individuals for “detecting and identifying an employee’s usage of, or impairment from, a cannabis item or other intoxicating substance, and for assisting in the investigation of workplace accidents.” It also states that any person who completes a CRC-approved WIRE training program “shall be issued a certification.”

Now what? The new WIRE certification process must now be put into action. Per the amendment, the CRC will work in consultation with the NJDOL to create the standards third-party trainers will use to qualify individuals to be certified WIREs.

EANJ will keep you posted.

Expanded Definitions Now Include Delta-8 and other “Intoxicating Hemp Products”

CREAMMA’s definition of “cannabis item” now defines and covers “intoxicating hemp products,” including hemp derived delta8 and similar THC analogs. Such hemp products which exceed the .5 milligrams per serving THC limit set out in the amended definition will now be regulated the same way as cannabis-derived delta‑8 and similar THC analogs.

More Flexible Hiring Screening Rules for Cannabis Employers

The amended law allows the Cannabis Regulatory Commission (CRC) to exempt certain workers – potentially including entry level roles – from background check requirements. Disqualifying convictions are now limited to substantially related indictable offenses within the last five years, and prior cannabis related convictions may not be considered. This change expands hiring flexibility and reduces barriers for job seekers‑level roles‑check requirements. Disqualifying convictions are now limited to substantially related indictable offenses within the last five years, and prior cannabis‑related convictions may not be considered. This change expands hiring flexibility and reduces barriers for jobseekers.

Feb 2026

On January 16, 2026, the New Jersey Division on Civil Rights (DCR) issued guidance clarifying how language-based practices may violate the New Jersey Law Against Discrimination (NJLAD). While the guidance does not create new legal obligations, it signals increased enforcement focus on workplace policies involving language, accents, and communication. Routine language rules, if not carefully justified, can expose employers to discrimination claims even absent discriminatory intent.

The DCR explains that although language itself is not a protected characteristic, it is closely tied to protected traits such as national origin, ancestry, nationality, race, religion, and disability. As a result, language‑related decisions may be unlawful if they function as a proxy for discrimination or disproportionately impact protected groups.

Common risk areas include accent bias in hiring or promotion, overly broad English‑only or fluency requirements, and failure to address language‑based harassment. Even neutral policies may create liability if they lack business necessity.

Language requirements may be lawful when they qualify as a bona fide occupational qualification (BFOQ)—meaning the language skill is genuinely needed to perform core job duties. To assess business necessity, employers should ask whether the language requirement is tied to safety, effective communication, regulatory obligations, or essential job functions—and whether a less discriminatory alternative could meet the same need.

Jan 2026

Governor Murphy has signed legislation expanding the New Jersey Family Leave Act (NJFLA), significantly broadening employer coverage and employee eligibility.

Effective under the new law, the employer coverage threshold is reduced from 30 or more employees to 15 or more employees. As a result, many smaller employers that were previously exempt are now subject to NJFLA requirements.

The law also revises employee eligibility standards. Employees will now qualify for NJFLA leave after they have been employed for at least three months and worked 250 hours in the 12 month period immediately preceding their need for leave. Previously, eligibility required 12 months of employment and at least 1,000 hours worked.

The new law also includes provisions affecting employees who collect Temporary Disability Insurance (TDI) or Family Leave Insurance (FLI) benefits. Under the amended statute, employees receiving these benefits are entitled to reinstatement to their position, or an equivalent position, upon return from leave. It is worth noting that the full scope of these protections is not entirely clear from the statutory language, and employers should monitor guidance from the Division on Civil Rights and the Department of Labor and Workforce Development as it becomes available.

Importantly, the revised eligibility requirements apply to all covered employers, not solely those newly brought under the statute due to the lower employee threshold. Employers should review their leave policies and management practices to ensure compliance.

These changes will become effective in July 2026.

Dec 2025

The New Jersey legislature’s lame duck session is underway in Trenton, and several employment-related bills advancing this session could impact HR compliance and workforce policies, including:

• A3451 – Family Leave Expansion: Gradually reduces the employer size threshold from 30 to 5 employees, expanding eligibility for family leave job protection.
• A4182 – Cannabis Industry Employment: Addresses conditions of employment for certain cannabis workers.
• S4385 – Non-Compete Ban: Would prohibit non-compete clauses, affecting current and future agreements.

Also Watch: The Department of Labor and Workforce Development has yet to finalize regulations on New Jersey’s ABC Test for determining independent contractor or employee classification. These regulations, if finalized, carry implications for wages, benefits, and tax compliance.

We’ll continue tracking developments and provide updates as warranted.

Nov 2025

The U.S. Department of Homeland Security (DHS) has issued an interim final rule eliminating the practice of automatically extending employment authorization documents (EADs) for most noncitizens who timely file renewal applications, starting October 30, 2025.Until now, many individuals who filed EAD renewal applications were allowed to keep working while waiting for their new card. However, under this new rule, automatic extensions will stop for most applicants.Employers can encourage workers to file renewal applications 120–180 days before their EAD expires to avoid a work gap.Read the DHS press release here.