New Jersey State Requirements

Employers doing business in the State of New Jersey are required to comply with certain provisions related to employee benefits.

Group Health Insurance

New Jersey Dependent Coverage

The Affordable Care Act requires the coverage of children to the age of 26.  Under New Jersey law, coverage of children may be provided through the age of 31.  This is only applicable to fully insured plans.

New Jersey Continuation Coverage

New Jersey’s continuation coverage law applies to employers with less than 20 employees.  The law extends coverage of an employee upon termination or other qualifying events for a period of 18 months.  It is similar to COBRA, but COBRA applies to employers with 20 or more employees.

Multiple Employer Welfare Arrangements

A Multiple Employer Welfare Arrangement (“MEWA”) is a welfare plan established by unrelated employers to offer benefits to their employees.  A MEWA may be subject to the federal requirements of the Employee Retirement Income Security Act (“ERISA”) are met.  However, a MEWA will generally be governed by State law.  The State of New Jersey has specific registration, reporting, and funding requirements.

Essential Health Benefits

Employers in the small group market, must offer Essential Health Benefits (“EHBs”) as determined by each state.  Essential health benefits include: 1) ambulatory patient services; 2) emergency services; 3) hospitalization; 4) maternity and newborn care; 5) mental health and substance use disorder services including behavioral health treatment; 6) prescription drugs; 7) rehabilitative and habilitative services and devices; 8) laboratory services; 9) preventive and wellness services and chronic disease management; and 10) pediatric services, including oral and vision care.

New Jersey’s EHB Plan includes state mandated benefits.

Employer Requirements

Employee Status – New Jersey’s “ABC Test”

Under New Jersey law, a worker is presumed an employee of the employer.  The employer has the burden of showing if a worker is an independent contractor by meeting the following three requirements: 1) worker “has been and will continue to be free from control or direction over the performance” of work; 2) the work is “outside the usual course of business…” or “is performed outside of all the places of business for the enterprise”; and 3) the worker “is customarily engaged in an independently established trade, occupation, profession or business.”

Temporary Disability Benefits

A New Jersey covered employer must provide disability benefits to its employees.  A covered employer is an employer subject to the state’s unemployment compensation law except for the State, its political subdivisions, and any instrumentality of the State, unless the entity elects to participate.

New Jersey Safe Act

The New Jersey Security and Financial Empowerment Act (“NJ SAFE Act”)  is a job protection statute applicable to employers with 25+ employees that provides 20 days of protected unpaid leave for an employee who is a victim of domestic violence or sexual assault.  An employee covered under NJ Safe Act is entitled to return to the position or equivalent position after the leave has ended.  Employers are required to post a Notice in a conspicuous place.

New Jersey Family Leave Act and New Jersey Law Against Discrimination

New Jersey Family Leave Act

An employer with 50+ employees nationwide, must comply with the New Jersey Family Leave Act (“NJFLA”) for all New Jersey employees.  The NJFLA requires covered employers to grant eligible employees time off from work in connection with the birth or adoption of a child or the serious illness of a parent, child, or spouse – it does not cover an employee for his/her own disability.  The NJFLA provides up to 12 weeks of leave during a 24 month period.

New Jersey Law Against Discrimination

The New Jersey Law Against Discrimination (“NJLAD”) makes discrimination based on race, creed, color, national origin, nationality, ancestry, age, sex (including pregnancy), familial status, marital status, domestic partnership or civil union status, affectional or sexual orientation, gender identity or expression, atypical hereditary cellular or blood trait, genetic information, liability for military service, and mental or physical disability, perceived disability, and AIDS and HIV status unlawful.  NJLAD prohibits unlawful discrimination in employment, housing, places of public accommodation, credit and business contracts.  However, not all classes are protected under all circumstances.

Sick Leave

The State of New Jersey does not have statewide sick leave.  However, many cities have city or municipal sick leave ordinances.  Employers should ensure 1) notice; 2) accrual; and 3) policy requirements are properly followed.

New Jersey Domestic Partnership Act and Civil Union Act

New Jersey Domestic Partnership Act

The State of New Jersey allows a same sex or opposite sex couple to enter into a domestic partnership upon meeting certain requirements under the Domestic Partnership Act (“DPA”), which became effective in 2004.  In 2007, the Civil Union Act amended the DPA requiring same sex or opposite sex couples to be 62 or older to register as a domestic partnership.  The couple must register as a domestic partnership to receive benefits.

New Jersey Civil Union Act

The Civil Union Act allows a same sex or opposite sex couple to become a civil union upon meeting certain requirements.  Same sex couples registered as  domestic partners may enter into a civil union without terminating the domestic partnership.


The information contained on this site is for educational purposes only. USI does not provide legal or tax advice. For advice specific to your situation, please consult an attorney or other professional.

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