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Payroll and Benefits Guide United States – New Jersey

Last updated: Apr 04, 2023

Currency
United States Dollar (USD)
Employer Taxes
12.05% – 23.90%
Payroll Frequency
Monthly/Semi-monthly
Employee Costs
9.255%
Capital
Trenton
Date Format
mm/dd/yyyy
Fiscal Year
1 January - 31 December
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Contribution

Employer Employer Payroll Contributions
1.20% – 7.00% Unemployment Insurance (State), applied on Salaries up to 42,300 Annually
3.10% Unemployment- New Employer (State)
0.09% Disability Insurance and Family Leave (State) applied on Salaries up to 161,400 USD Annually
6.20% FICA Social Security (Federal), applied on Salaries up to 168,000 Annually
1.45% FICA Medicare (Federal)
0.60% -6.00% (Maximum taxable wages is 7,000 USD) FUTA (Federal Unemployment Tax Act)  The FUTA tax rate is 6.0% with a taxable wage base of 7,000 USD. However, if states operate their unemployment insurance programs in compliance with federal law then the FUTA tax is reduced (credit) by 5.4% to 0.6%.
12.05% – 23.90% Total Employment Cost
Employee Employee Payroll Contributions
0.425% New Unemployment Insurance applied on Salaries up to 42,300 Annually
0.09% Family Leave Insurance (State) applied on Salaries up to 161,400 Annually
6.20% FICA Social Security (Federal) applied on Salaries up to 168,000 Annually
1.45% FICA Medicare (Federal)
0.90% Additional tax on earnings over 200,000 USD (High-income earners also pay an additional 0.9 percent in Medicare taxes)
9.255% Total Employee Cost
State Employee Income Tax
State Tax – Single
1.40% 0 USD to 20,000 USD
1.75% 20,000 USD to 35,000 USD
3.50% 35,000 USD to 40,000 USD
5.53% 40,000 USD to 75,000 USD
6.37% 75,000 USD to 500,000 USD
8.97% 500,000 USD to 1,000,000 USD
10.75% over 1,000,000 USD
Married taxpayers filing jointly
1.40% 0 USD to 20,000 USD
1.75% 20,000 USD to 50,000 USD
2.45% 50,000 USD to 70,000 USD
3.50% 70,000 USD to 80,000 USD
5.53% 80,000 USD to 150,000 USD
6.37% 150,000 USD to 500,000 USD
8.97% 500,000 USD to 1,000,000 USD
10.75% over 1,000,000 USD
Federal Employee Income Tax
Federal Tax – Singles
10.00% Up to 11,600 USD
12.00% 11,601 USD to 47,150 USD
22.00% 47,151 USD to 100,525 USD
24.00% 100,525 USD to 191,950 USD
32.00% 191,950 USD to 243,725 USD
35.00% 243,725 USD to 609,350 USD
37.00% 609,350 USD or more
Federal Tax – Married, filing jointly
10.00% Up to 22,000 USD
12.00% 22,001 USD to 89,450 USD
22.00% 89,451 USD to 190,750 USD
24.00% 190,751 USD to 364,200 USD
32.00% 364,201 USD to 462,500 USD
35.00% 462,501 USD to 693,750 USD
37.00% 693,751 USD or more
Federal Tax – Heads of Households Federal Tax – Heads of Households
10.00% Up to 15,700 USD
12.00% 15,701 USD to 59,850 USD
22.00% 59,851 USD to 95,350 USD
24.00% 95,351 USD to 182,100 USD
32.00% 182,101 USD to 231,250 USD
35.00% 231,251 USD to 578,100 USD
37.00% 578,101 USD or more
Standard Deduction and Personal Exemption
14,600.00 USD Single
29,200.00 USD Married Filing Jointly
21,900.00 USD Head of Household

Minimum Wage

General

New Jersey has a state Minimum Wage Law, of 14.13 USD per hour worked.

Payroll

Payroll Cycle

Employees in New Jersey are generally paid either semi-monthly or monthly, with payments on dates as stipulated in the employment contract.

13th Salary

There is no legislation for 13th-month payments in New Jersey.

Working Hours

General

In New Jersey, the working week consists of a maximum of 40 hours per week, 8 hours per day.

Overtime

New Jersey adheres to the Fair Labor Standards Act (FLSA), and overtime is paid where employees work more than 40 hours in a single working week. The employer must pay 150% of the regular salary rate for the extra hours worked as overtime. Similarly, if employees are scheduled to work on weekends or rest days, no additional payment is required. However, should an employer request an employee to work in exceptional circumstances on these days, overtime will be payable at 150% of the regular salary rate for the extra hours worked.

Leave

Annual Leave (vacation)

New Jersey does not have any state statute governing the amount and payment of vacation time; however, it is common for employers to decide whether to offer paid or unpaid vacation leave. This must comply with employment law and must be stipulated in the collective bargaining agreements.

Public Holidays

Public holidays are not mandatory paid days off, but employers commonly allow workers to take federal holidays as paid days off.

Some companies might also agree to allow workers to take off state holidays; workers can find specific state holiday dates from their local government.

Usually when an agreed public holiday falls on a weekend, a day off in lieu is given on the Friday before or the Monday after the holiday.

Date Day Holiday Note
1 Jan 2024 Monday New Year’s Day
15 Jan 2024 Monday Martin Luther King Jr. Day
19 Feb 2024 Monday Presidents Day
27 May 2024 Monday Memorial Day
19 Jun 2024 Wednesday Juneteenth Independence Day
4 Jul 2024 Thursday Independence Day July
2 Sep 2024 Monday Labor Day
14 Oct 2024 Monday Columbus Day
11 Nov 2024 Monday Veterans Day
28 Nov 2024 Thursday Thanksgiving Day
25 Dec 2024 Wednesday Christmas Day

 

Sick Days

In New Jersey, employers must provide one hour of paid sick leave for every 30 hours worked, up to an annual maximum of 40 hours of paid sick leave.

It is common for an employer to follow the Family and Medical Leave Act (FMLA), which provides certain employees with up to 12 weeks of unpaid, job-protected leave per year for specific family and medical reasons (maternity leave, serious illnesses, or if the employee needs to care for a spouse or child).

Employees are eligible for FMLA if they have worked for their employer for at least one year, completed a minimum of 1,250 hours over the past year, and worked at a location where the company employs 50 or more employees within 75 miles.

In addition to the FMLA, New Jersey has the New Jersey Family Leave Act, which provides employees with benefits after the recovery period for up to 6 weeks, increasing to 12 weeks of leave in 24 months for specific employees as below:

  • Employers with 50 or more employees
  • Employees who have worked at least 100 hours during the last 12 months
  • Employees who must care for a child within a year of birth, placement for adoption, foster care, or caring for a family member

Maternity Leave

The FMLA (see Sick Leave above) provides certain employees with up to 12 weeks of unpaid, job-protected leave per year for specific family and medical reasons (maternity leave, serious illnesses, or if the employee needs to care for a spouse or child). The FMLA provides:

  • Twelve working weeks of leave in any one year for a child’s birth and to care for the newborn child within one year of birth.
  • The employee may be entitled to leave for the adoption or foster care of a child and care for the newly placed child within one year of placement.

New Jersey residents also benefit from the Temporary Disability Insurance (TDI) program, which provides employees who are temporarily unable to work due to disabilities related to pregnancy or childbirth with ten weeks of paid leave up to two-thirds of the regular salary. The employee must take up to four weeks of leave before the birth and up to six weeks after.

Paternity Leave

The FMLA (see Sick Leave above) provides certain employees with up to 12 weeks of unpaid, job-protected leave per year for specific family and medical reasons (maternity leave, serious illnesses, or if the employee needs to care for a spouse or child). The FMLA provides:

  • Twelve working weeks of leave in any one year for a child’s birth and to care for the newborn child within one year of birth.
  • The employee may be entitled to leave for the adoption or foster care of a child and care for the newly placed child within one year of placement.

Parental Leave

The FMLA (see Sick Leave above) provides certain employees with up to 12 weeks of unpaid, job-protected leave per year for specific family and medical reasons (maternity leave, serious illnesses, or if the employee needs to care for a spouse or child). The FMLA provides:

  • Leave in the event of a serious health condition that makes the employee unable to perform the essential functions of their job.
  • Any qualifying exigency arising out of the fact that the employee’s spouse, son, daughter, or parent is a covered military member on “covered active duty.”

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  • 26 working weeks of leave during a single one-year period to care for a covered service member with a serious injury or illness if the eligible employee is the service member’s spouse, son, daughter, parent, or next of kin (military caregiver leave).

The New Jersey Family Leave Act provides the employee with benefits after the recovery period for up to 6 weeks, increasing to 12 weeks of leave in 24 months for specific employees as below:

  • Employers with 50 or more employees
  • Employees who have worked at least 100 hours during the last 12 months
  • And employees who must care for a child within a year of birth, placement for adoption, foster care, or caring for a family member

Other Leave

New Jersey law requires all employers to provide their full-time employees job-protected but unpaid leave for their duty as jurors or as a witness in a case, responding to a subpoena: or acting as a plaintiff or defendant in the courts. Employees must provide a copy of the jury summons to the employer as evidence of requirement.

New Jersey law provides protection against discrimination for members of U.S. armed forces, reserves, National Guard, commissioned corps of the Public Health Service, and any other category of persons designated by the president in a time of war or emergency.

PAID MATERNITY LEAVE (DAYS)

Highest
Lowest

Termination

Termination Process

Except in mass dismissals or as provided for in an employment contract or a collective bargaining agreement, U.S. law does not impose a formal “notice period” to terminate an individual employment relationship, and employment is stipulated “at will.” This means that either the employer or the employee may end the employment relationship without giving either notice or reason, provided it is not illegal, notable discrimination on the grounds of a category protected by law, etc., and as per the Federal Worker Adjustment and Retraining Notification Act (WARN).

The employment contracts of executives and other highly skilled individuals often incorporate a “just cause termination” clause which mandates that the employer may only terminate the employee for “cause” and lists the permissible grounds. In such cases, the parties negotiate the foundations for a “just cause” termination case by case.

Notice Period

In New Jersey, most employees are employed “at-will,” and either party can terminate the employment relationship without notice. In New Jersey, pay out of unused vacation time is not required by law. Still, generally, employers will pay an employee for unused vacation days, provided the employee gave some advanced notice of resignation; there is no official notice period. Still, in general practice, two weeks’ notice is a minimum requirement.

In mass dismissal cases the Worker Adjustment and Retraining Notification Act (WARN Act) must be followed, and employers must give 60 days’ notice to impacted employees.

Severance Pay

Except as otherwise provided in an employment contract or collective bargaining agreement, employers need not make severance payments to terminated employees. Employers who choose to offer severance would need to have the provisions within the employee’s contract and agreed by both parties, many employers choose to offer severance payment linked to the employee’s length of service. Most common in New Jersey is one week pay for every year of service.

Probation Period

No legal provision governs a formal “trial/probation period.” However, it is common practice for employers to set a performance evaluation after an initially stated period of employment of 90 days.

VISA

VISA

Foreign nationals without permanent resident status or a work visa are not permitted to work in the United States. An employer seeking to hire a foreign national may file a petition with the United States Department of Homeland Security/United States Citizenship and Immigration Services (USCIS) for an employment visa on behalf of the prospective employee. If the petition is approved, the prospective employee must obtain a “visa stamp” from a United States embassy or consulate (Canadian citizens are exempt from this requirement). To get a temporary U.S. work visa, an employer must file a petition with U.S. Citizenship and Immigration Services (USCIS). An approved petition must be part of the visa request; the types of visas include:

  • H-1B – for applicants with a college degree hired to do specialized work. The visa is valid for three years and can be extended for an additional three years. The visa is connected to the employer that filed the petition. If there is a change of employer, the new employer must repeat the process. There are 65,000 H-1B visas available each year.
  • H-1B1 – for applicants with a college degree from Chile and Singapore. The US government grants up to 1,400 visas to Chilean citizens and 5,400 from Singapore each year.
  • H-2A – for temporary or seasonal agriculture work. It is limited to citizens of qualified countries. Usually valid for up to 1 year and can be extended to a maximum of 3 years.
  • H-2B – for temporary non-agricultural work. These visas are limited to citizens of qualified countries. Usually valid for up to 1 year and can be extended to a maximum of 3 years.
  • L – for intercompany transfers (people transferred from a foreign company to a US branch of the company.) The applicant must have been employed at the company for a year before the transfer and work in a managerial level position or higher with specialized knowledge.
  • 0 – for people with extraordinary ability in science, arts, education, business, or athletics.

The standard procedure is to obtain a short-term work visa and then apply for an immigrant visa after the employee has started working in the United States.

For those seeking employment-based immigrant visas:

  • E-1 – highest priority employment for those with extraordinary ability in science, arts, education, business, and athletics.
  • E-2 – for those with advanced degrees or exceptional ability.
  • E-3 – for skilled workers and professionals, as well as unskilled workers.
  • E-4 – members of certain immigrant groups.
  • E-5 – immigrant investors in US companies (substantial investment).

Alternatively, an employer may sponsor a potential employee’s application for permanent resident status, referred to as a “green card,” if the employee can establish that the potential employee is a multinational executive/manager transferee, has unique skills, or has been offered a job in the United States. The employer must have been unable to recruit a U.S. worker who meets the position’s minimum requirements.

All employers are obligated to verify that all individuals they employ are authorized to work in the United States.

VAT

General

New Jersey has a combined Sales Tax Rate of 6.628% (State tax at 6.625% and Local tax of 0%- 2%)

Stay up to date on payroll & employment law changes

Version History

February 10, 2022
New Jersey minimum wage increased to 13.00 USD per hour.
New Jersey has a minimum Sales Tax Rate of 7.00% in 2022.
January 1, 2021
Minimum wage: rises to $12.00 per hour; $11.10 per hour for seasonal work or employers with fewer than 6 employees; $10.30 for agricultural work.
Payroll contributions and personal income tax rates have been updated.
September 1, 2020
Income tax: Threshold for highest tax bracket moved down from $5,000,000 annual income to $1,000,000, retroactive to beginning of 2020.
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Payroll and Benefits Guide in United States – New Jersey

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Payroll and Benefits Guide
in United States – New Jersey

What’s covered in this guide:

  • Employer/employee contributions
  • Minimum wage
  • Working hours
  • Visa requirements

And more...

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Public Holidays Calendar

United States – New Jersey
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Date Day Holiday Note
1 Jan 2024 Monday New Year’s Day
15 Jan 2024 Monday Martin Luther King Jr. Day
19 Feb 2024 Monday Presidents Day
27 May 2024 Monday Memorial Day
19 Jun 2024 Wednesday Juneteenth Independence Day
4 Jul 2024 Thursday Independence Day July
2 Sep 2024 Monday Labor Day
14 Oct 2024 Monday Columbus Day
11 Nov 2024 Monday Veterans Day
28 Nov 2024 Thursday Thanksgiving Day
25 Dec 2024 Wednesday Christmas Day