NJ Changes Unemployment Law Regarding Misconduct
The state of New Jersey has enacted new language to the unemployment law pertaining to penalties associated with misconduct, and the proof needed by an employer. The language in this new law can be difficult to understand, so we will try to break it down as simply as possible.
Under Governor Christie, there were three classifications of misconduct: Misconduct, Severe Misconduct, and Gross Misconduct. Under the new law, there will now be two classifications of misconduct: Misconduct and Gross Misconduct. Gross Misconduct is essentially defined as an act punishable as a crime of the first, second, third, or fourth degree under the “New Jersey Code of Criminal Justice”. Anything else will fall into the category of misconduct.
The penalty associated with Gross Misconduct is that the claimant is disqualified from any unemployment benefits associated with the employer from which the claimant was discharged. The penalty associated with misconduct is that the claimant is disqualified for the five weeks which immediately follow the week in which the individual was discharged for misconduct. The employer’s unemployment tax account will then be relieved of charges for any benefits paid to the claimant following the disqualification period.
Furthermore, there is additional language added to put emphasis on the requirement for written documentation written at, or immediately following the time of the misconduct that demonstrates the actions of the employee constitute misconduct or gross misconduct.
How does this impact employers?
It does not directly affect employers because they will still get relieved of charges anytime a claim is ruled as misconduct. However, it will drain the reserve balances at the state level, due to the fact that more benefits will be paid out to claimants since Severe Misconduct will be eliminated. Lower state reserves will cause the tax table to shift, and employer unemployment tax rates will rise.
The law can be found here: https://www.njleg.state.nj.us/2018/Bills/A4000/3871_I1.PDF