New Jersey’s Unemployment Compensation Law Imposes New Obligations on Employers

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Patricia Tsipras

August 25, 2023

Effective July 31, 2023, amendments to New Jersey’s Unemployment Compensation Law (“the UC Law”) have increased the responsibilities of New Jersey employers when workers depart.

New Reporting Requirements
New Jersey employers previously were required to provide departing employees with Form BC-10 (Instructions for Claiming Unemployment Benefits).  Starting July 31, 2023, employers must “immediately and simultaneously” send to the Division of Unemployment Insurance (“the Division”) of the New Jersey Department of Labor & Workforce Development a copy of the Form BC-10 that it provided to the departing employee.

The Division plans to prepare a new form (which the Division has not yet released) that employers will have to complete with information about the employee’s separation from employment.  The information requested on the new form will assist the Division in making benefits determinations.  However, the form will be required regardless of whether the employee applies for unemployment benefits.

Required Electronic Submissions
The amended UC Law requires employers and the Division to conduct all communications electronically.  Though the amended UC Law took effect on July 31, 2023, New Jersey’s Department of Labor still is developing the infrastructure that will enable electronic submissions.  Guidance is forthcoming.  In the meantime, employers should create an account with Employee Access as soon as possible to receive updates via email.

Important Deadlines
The amended UC Law sets or changes relevant deadlines.  Specifically:

• The Division must notify the employer of any missing information on the submitted forms within seven days of the employee’s unemployment insurance claim or the employer’s submission of the required information (whichever comes first).
• The Division will now have three weeks from the date that it receives a claim to make an initial benefits determination.
• An employer no longer may retroactively contest a benefits determination if the employer is late in providing separation information.
• Employers will now have only seven days from receipt of an initial benefits decision to appeal that decision.
• Employees will now have up to 21 days from the date that the initial benefits decision was mailed to appeal that decision.

Increased Penalties
Non-compliant employers face significant penalties under the new amendments, including a $500 fine or 25% of the unemployment benefits if an employer “willfully fails or refuses to furnish any reports or information,” or if an employer knowingly makes a false statement or fails to disclose a material fact to avoid or reduce the payment of unemployment benefits.  Moreover, each day the violation occurs is considered a separate offense under the UC Law.

Liability for Overpayments
Before the amended UC Law took effect, an employee who received an overpayment would be required to pay it back.  Under the new UC Law, if it is determined that an employer’s error caused the overpayment, the employer’s account will be charged for the error.  If the employee caused the error, the employee must pay the amount back to the Division.  If the Division caused the error, the overpayment will be deducted from the employee’s unemployment benefits.

Employer Takeaways
Employers in New Jersey must be mindful of the increased duties that the amended UC Law imposes upon them and update their procedures to ensure compliance when employees depart.

*Special thanks to Brooke Palma, our Office Administrator, for her contributions to this article.

The author of this article, Patricia Tsipras, is a member of the Bar of Pennsylvania.  This article is designed to provide one perspective regarding recent legal developments, and is not intended to serve as legal advice in New Jersey, Pennsylvania, or any other jurisdiction, nor does it establish an attorney-client relationship with any reader of the article where one does not exist.  Always consult an attorney with specific legal issues.