Maia v. IEW Construction Group
In a unanimous decision, the New Jersey Supreme Court found that the 2019 New Jersey Wage Theft Act’s amendments (“Wage Theft Amendments”) to the Wage and Hours Law (“WHL”) and the Wage Payment Law “(“WPL”) should not apply retroactively to claims that accrued before the effective date of the Wage Theft Amendments. In this case, the plaintiffs filed a class action complaint against their former employer, IEW Construction Group (“IEW”), alleging that IEW failed to pay them for “pre-shift” and “post-shift” work. The plaintiffs sought to take advantage of the Wage Theft Amendments, which among other things: (1) extended the limitations period applicable to WHL claims from two to six years; (2) permitted plaintiffs to recover liquidated and treble damages, as well as attorneys’ fees and costs, for both WHL and WPL claims; and (3) created a new statutory cause of action against employers for retaliation.
Before the trial court, IEW successfully moved for partial dismissal of the plaintiffs’ complaint on the basis that, in accordance with longstanding precedent, the Wage Theft Amendments should not be applied retroactively. On appeal, however, the Appellate Division held that permitting the plaintiffs to rely on the Amendments did not constitute retroactive application of the law. Relying on language from the New Jersey Supreme Court’s decision in W.S. v. Hildreth, 252 N.J. 506 (2023), the Appellate Division held that “[a]pplying the law in effect at the time a complaint is filed . . . is not applying a statute retroactively; it is applying a statute prospectively to cases filed at its effective date.”
In its amicus brief in support of IEW, NJCJI argued that the plaintiffs and the Appellate Division misconstrued the holding in Hildreth. NJCJI explained that longstanding principles of New Jersey case law dictate that when the Legislature enacts legislation that changes the legal consequences of acts that transpired before a law’s effective date, courts must conduct a multi-step analysis to determine if such legislation should apply retroactively. Turning to Hildreth, NJCJI explained the holding from that decision was inapposite to the instant case. NJCJI argued that, contrary to plaintiffs’ view, Hildreth stood for the narrow proposition that where amendments to laws concern merely the procedural prerequisites to filing suit, the retroactivity analysis is not triggered. This is because such amendments do not change the legal consequences of a defendants’ conduct, but merely impact whether plaintiffs have cleared the procedural hurdles necessary to bring their claims. By contrast, NJCJI maintained that the Wage Theft Amendments fundamentally changed the consequences of IEW’s conduct by imposing a new limitations period, permitting the recovery of liquidated damages, treble damages and attorneys’ fees, and creating a new statutory cause of action against employers for retaliation.
Writing for a unanimous Court, Justice Fasciale agreed with NJCJI that the Wage Theft Amendments should not be applied retroactively, adopting NJCJI’s arguments concerning the applicability of the retroactivity analysis, as well as the true impact of Hildreth. Specifically, Justice Fasciale agreed with NJCJI that “Hildreth is distinguishable from this appeal because the amendments to procedural requirements at issue there did not create new damages, change the rights, responsibilities, claims, and defenses that parties can assert, or implicate new legal burdens, as is the case here with [the Wage Theft Amendments].” Had the Court adopted the Appellate Division’s understanding of Hildreth, this would have undercut decades of precedent concerning retroactive application of new laws and placed New Jersey out of step with virtually all other jurisdictions to have addressed this issue. As a result of this decision, the Court overturned the Appellate Division’s decision and reinstated the trial court’s order partially dismissing the plaintiffs’ claim arising under the Wage Theft Amendments.
A copy of the Court’s unanimous decision can be found here. Copies of NJCJI’s amicus curiae brief can be found here. NJCJI’s in-house counsel, Alex Daniel, Esq., alongside Ryan T. Warden, Esq., of White and Williams, LLP, represented NJCJI in connection with this case. NJCJI thanks Mr. Warden for his generous contributions of time and expertise.