In Christopher Maia v. IEW Construction Group (A-3-23/088010) (May 15, 2024), the Supreme Court of New Jersey clarified the statute of limitations under the Wage Theft Act, holding that the 2019 law does not apply retroactively.
Facts of Maia v. IEW Construction Group
Plaintiffs Christopher Maia and Sean Howarth were employed as laborers for defendant IEW Construction Group, which required them to perform “pre-shift” and “post-shift” work. Maia joined IEW in April 2019. From early May 2019, he was not paid for his “pre-shift” and “post-shift” work. Howarth began working for IEW in April 2020. He was never paid for “pre-shift” and “post-shift” responsibilities. Both Maia and Howarth were laid off in November 2021.
In April 2022, they filed a class action complaint alleging that IEW violated the Wage Payment Law (WPL) and the Wage and Hour Law (WHL). In 2019, L. 2019, c. 212 (Chapter 212) amended the WPL and the WHL by providing additional remedies and by extending the WHL’s statute of limitations from two to six years.
The trial judge held that Chapter 212 does not apply retroactively and thus dismissed plaintiffs’ claims for conduct that arose prior to Chapter 212’s effective date of August 6, 2019. The Appellate Division reversed, holding that held that plaintiffs were entitled to the remedies available under the WHL and WPL as of the date of their complaint because “[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 after its effective date.”
NJ Supreme Court’s Decision in Maia v. IEW Construction Group
The New Jersey Supreme Court reversed. “We hold that the Legislature intended Chapter 212 to be prospective, not retroactive,” Justice Fasciale wrote. “Thus, Chapter 212 applies to conduct occurring on or after its effective date of August 6, 2019, but not to conduct occurring before then.”
The New Jersey Supreme Court first addressed the Appellate Division’s determination that applying Chapter 212 to conduct occurring prior to its effective date is not a retroactive application, but rather prospective application of a statute “to cases filed after its effective date.” In finding the appeals court erred, the Court emphasized that both federal law and state law determine whether a statute’s application is retroactive by focusing on any changes to the legal consequences created by a statute or amendment.
With regard to Chapter 212, the New Jersey Supreme Court found that by adding liquidated damages and a retaliation claim to both the WPL and WHL, attorneys’ fees to the WPL, and by extending the statute of limitations in the WHL, Chapter 212 allows plaintiffs to bring new claims with enhanced damages that were not previously available to plaintiffs at the time their injuries occurred, thereby changing the legal consequences of acts. “The changes are not merely procedural; rather, they affect the duties and liabilities involved,” Justice Fasciale wrote.
The New Jersey Supreme Court next turned to whether retroactive application of the statute’s effective date was appropriate, explaining that there are three circumstances that justify applying a statute retroactively: (1) when the Legislature explicitly or implicitly expresses an intent that a law be retroactive; (2) when an amendment is ameliorative or curative; or (3) when the parties’ expectations warrant retroactive application.
It concluded that none of the circumstances applied. In support, the Court cited that the Legislature expressly stated in Section 14 of Chapter 212 that the new provisions “shall take effect immediately,” a phrase that New Jersey Courts have repeatedly held to signal prospective application.
In light of its decision, the New Jersey Supreme Court reinstated the trial judge’s order partially dismissing plaintiffs’ complaint, and remanded for further proceedings.