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LEXSTAT 38 NJR 4980(A)

NEW JERSEY REGISTER
Copyright © 2006 by the New Jersey Office of Administrative Law

VOLUME 38, ISSUE 23

ISSUE DATE: DECEMBER 4, 2006

RULE PROPOSALS

LABOR AND WORKFORCE DEVELOPMENT
DIVISION OF WAGE AND HOUR COMPLIANCE

38 N.J.R. 4980(a)

Proposed Readoption with Amendments: N.J.A.C. 12:55

Wage Payments

Authorized By: David J. Socolow, Commissioner, Department of Labor and Workforce Development.

Authority: N.J.S.A. 34:1-20, 34:1A-3(e), 34:11-4.4 and 34:11-4.11.

Calendar Reference: See Summary below for explanation of exception to calendar requirement.

Proposal Number: PRN 2006-387.

A public hearing on the proposed readoption with amendments will be held on the following date at the following lo-
cation:
Thursday, January 4, 2007
10:00 A.M. to 12:00 Noon
New Jersey Department of Labor and Workforce Development
John Fitch Plaza
1st Floor, Conference Room
Trenton, New Jersey
Please call the Office of Legal and Regulatory Services at (609) 292-2789 if you wish to be included on the list of
speakers.

Submit written comments by February 2, 2007 to:
David Fish, Regulatory Officer
Office of Legal and Regulatory Services
New Jersey Department of Labor and Workforce Development
PO Box 110 - 13th Floor
Trenton, New Jersey 08625-0110
Fax to: (609) 292-8246
If you need this document in Braille, large print or audio cassette, contact the Office of Marketing at (609) 292-
7832 or NJ Relay (TTY) 1-800-852-7899.

The agency proposal follows:
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38 N.J.R. 4980(a)

Summary
Pursuant to N.J.S.A. 52:14B-5.1c, N.J.A.C. 12:55, Wage Payments, is scheduled to expire on April 23, 2007. The
Department has reviewed these rules and, with the exception of technical amendments made throughout the chapter
which reflect a change in the name of the Department from the "Department of Labor" to the "Department of Labor and
Workforce Development," has determined them to be necessary, reasonable and proper for the purposes for which they
were originally promulgated. Accordingly, the Department proposes that N.J.A.C. 12:55 be readopted, with amend-
ments.
A summary of the sections of N.J.A.C. 12:55 follows:
N.J.A.C. 12:55-1.1 sets forth the purpose and scope of the chapter.
N.J.A.C. 12:55-1.2 defines the words and terms used throughout the chapter.
N.J.A.C. 12:55-1.3 lists the powers of the Commissioner.
N.J.A.C. 12:55-1.4 concerns the punishment for violation of N.J.S.A. 34:11-4.1 et seq. (the Wage Payment Law).
N.J.A.C. 12:55-1.5 sets a schedule of administrative fees.
N.J.A.C. 12:55-1.6 establishes a schedule of administrative penalties, a procedure for notification of such penalties,
and the factors to be considered by the Commissioner when assessing such penalties.
N.J.A.C. 12:55-1.7 addresses the payment of interest on awards of back pay.
N.J.A.C. 12:55-1.8 sets forth the procedure for the request of a hearing with regard to the assessment of an adminis-
trative penalty.
N.J.A.C. 12:55-2.1 sets forth the provisions governing payroll deductions, taken directly from N.J.S.A. 34:4.4.
N.J.A.C. 12:55-2.2 concerns deductions for mass transportation commuter tickets.
N.J.A.C. 12:55-2.3 concerns voluntary wage deductions for repayment of financial obligations to the State of New
Jersey.
N.J.A.C. 12:55-2.4 sets forth the procedure for the time and mode of final wage payment.
N.J.A.C. 12:55-2.5 concerns withholding of income tax for foreign jurisdictions.
As the Department has provided a 60-day comment period for this notice of proposal, this notice is excepted from
the rulemaking calendar requirements, pursuant to N.J.A.C. 1:30-3.3(a)5.

Social Impact
The rules proposed for readoption will have a positive social impact in that they will continue to ensure that work-
ers receive the pay and benefits to which they are entitled under the Wage Payment Law. The rules proposed for readop-
tion will also enable the Department to continue to meet its enforcement responsibilities under the Wage Payment Law.
The proposed amendments are of a purely technical nature and will have no social impact.

Economic Impact
The rules proposed for readoption will continue to impose costs in the form of administrative fees and penalties on
those employers who violate the Wage Payment Law. These costs are statutorily mandated and are necessary to ensure
that workers receive all wages earned and due. The proposed amendments are of a purely technical nature and will have
no economic impact.

Federal Standards Statement
The rules proposed for readoption and the proposed amendments permit amounts to be withheld from wages and
diverted for contributions to Federally-chartered banks or, under a collective bargaining agreement, to employee wel-
fare, insurance, hospitalization, medical or surgical or both, pension, retirement and profit sharing plans establishing
individual retirement annuities on a group or individual basis, as defined in the Internal Revenue Code, 26 U.S.C. §
408(a) and (b). All Federal deductions referred to within N.J.A.C. 12:55-2.1 are consistent with and do not exceed the
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38 N.J.R. 4980(a)

withholding requirements contained in the Internal Revenue Code, 26 U.S.C. § 3402, as amended by P.L. 107, June 7,
2001, 115 Stat 38. No other Federal standards or requirements impact upon the rules proposed for readoption with
amendments.

Jobs Impact
The rules proposed for readoption and the proposed amendments will have no impact on jobs. The Department does
not anticipate an increase or decrease in jobs as a result of these rules.

Agriculture Industry Impact
The rules proposed for readoption and the proposed amendments will have no impact on the agriculture industry.

Regulatory Flexibility Analysis
The rules proposed for readoption and the proposed amendments impose reporting, recordkeeping and compliance
requirements on small business, as that term is defined by the Regulatory Flexibility Act, N.J.S.A. 52:14B-16 et seq.
Specifically, all employers must continue to maintain accurate time and payroll records including any deductions that
are withheld from an employee's pay. The costs incurred by employers continues to be any administrative fees and pen-
alties imposed for noncompliance with the chapter requirements. Lesser requirements cannot be proposed for small
businesses, since accurate time and payroll records are necessary to ensure that workers receive all wages earned and
due consistent with the Wage Payment Law. Employers have the option of utilizing outside professional services in
order to comply with these requirements. The use of such services is not mandated by the rules proposed for readoption
or by the proposed amendments.

Smart Growth Impact
The rules proposed for readoption and the proposed amendments would not have an impact on the achievement of
smart growth and the implementation of the State Development and Redevelopment Plan.

Full text of the rules proposed for readoption may be found in the New Jersey Administrative Code at N.J.A.C. 12:55.

Full text of the proposed amendments follows (additions indicated in boldface thus):

SUBCHAPTER 1. GENERAL PROVISIONS; VIOLATIONS; FEES AND PENALTIES; HEARINGS

12:55-1.2 Definitions

The following words and terms, when used in this chapter, shall have the following meanings unless the context clearly
indicates otherwise.

...

"Commissioner" means the Commissioner of Labor and Workforce Development or his or her designee.

...

12:55-1.5 Administrative fee

(a)-(b) (No change.)

(c) All payments shall be made payable to the Commissioner of Labor and Workforce Development, Wage Payment
Trust Fund by certified check or money order, or in the form suitable to the Commissioner of Labor and Workforce
Development.

12:55-1.6 Administrative penalty
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38 N.J.R. 4980(a)

(a) (No change.)

(b) No administrative penalty shall be levied pursuant to this subchapter unless the Commissioner provides the alleged
violator with notification by certified mail of the violation and the amount of the penalty and an opportunity to request a
formal hearing. A request for a formal hearing must be received within 15 working days following the receipt of the
notice.

1.-3. (No change.)

4. All payments shall be payable to the Commissioner of Labor and Workforce Development, Wage Payment Trust
Fund in the form of a certified check or money order, or such other form suitable to the Commissioner of Labor and
Workforce Development.

12:55-2.1 Payroll deductions; general

(a) No employer may withhold or divert any portion of an employee's wages unless:

1. (No change.)

2. The amounts withheld or diverted are for:

i.-vii. (No change.)

viii. Such other contributions, deductions and payment as the Commissioner of Labor and Workforce Development
may authorize by regulation as proper and in conformity with the intent and purpose of the Act, if such deductions are
approved by the employer.