Insights Archives — Lindabury, McCormick, Estabrook & Cooper, P.C. Firm News & Events

Key Trends in New Jersey Corporate Law 2025

Published on: April 23, 2025 | by Robert W. Anderson

Businesses with operations in New Jersey face new legal requirements that affect how they manage hiring, taxes, data privacy, and investment strategy. This update outlines recent legislative and regulatory changes that impose new obligations and potential risks for employers, corporate taxpayers, and companies engaged in digital commerce or AI development. Understanding these developments is critical to maintaining compliance, controlling costs, and identifying available incentives.

Pay Transparency Law (Effective June 1st, 2025)

New Jersey employers with 10 or more employees over a period of 20 calendar weeks must include salary ranges and general benefit information in all job postings. This includes internal promotions and transfers. The law applies to any employer doing business in the state or accepting applications from New Jersey, regardless of the company’s location.

The New Jersey Supreme Court Rules: Commissions are Wages

Published on: March 21, 2025 | by Lisa Gingeleskie

On March 17, 2025, the New Jersey Supreme Court issued a unanimous decision finding that commissions are wages under the New Jersey Wage Payment Law (“WPL”) because they are “direct monetary compensation for labor or services rendered by an employee.” There are no exceptions – compensating an employee by paying a commission for a labor or service always constitutes a wage under the law.

The Underlying Dispute

Plaintiff, Rosalyn Musker (“Musker”), worked as a sales manager for the Defendant company, Sukhi, Inc. (“Suuchi”), which provided a proprietary software platform for apparel manufacturers and primarily generated revenue from subscriptions to its services. Musker earned a base salary of $80,000 and was entitled to receive commissions based on different tiers of sales that she reached in accordance with Suuchi’s Sales Commission Plan (the “SCP”), which included language intended to “cover all sales situations.”

The New Jersey Data Protection Act is in Effect

Published on: February 24, 2025 | by Lisa Gingeleskie

On January 16, 2025, New Jersey’s Data Protection Act (“NJDPA” or the “Act”) went into effect, making New Jersey the nineteenth state to adopt a comprehensive data privacy law. The opportunity to cure any defects under the law will sunset on July 1, 2026. Therefore, it is critical that covered entities, or “controllers” of personal data, act now to ensure compliance with the law’s requirements as outlined more fully in this article.

To Whom Does the Law Apply?

The NJDPA applies to companies that:

New Jersey Employment Law: What to Expect in 2025

Published on: February 13, 2025 | by Lisa Gingeleskie

As we are already a few weeks into the new year, now is a good time for employers to review their employee handbooks and policies to ensure compliance with the following changes in New Jersey employment law or best practices.

The Pay Transparency Act

Effective June 1, 2025, New Jersey employers with ten (10) or more employees over twenty (20) calendar weeks doing business or taking applications for employment in the State of New Jersey must disclose “the hourly wage or salary, or a range of the hourly wage or salary, and a listing of benefits and other compensation programs for which the employee would be eligible within the employee’s first 12 months of employment.” Notably, this requirement does not prohibit an employer from increasing the wages, benefits, and compensation identified in the job posting at the time of making an offer for employment to an applicant.

Umbrella Liability Insurance

Published on: January 17, 2025 | by Elizabeth Candido Petite

Clients often ask about ways to protect their assets and limit liability in the event of future creditors. Transferring assets to trusts, limited liability companies, or into the names of others (for example, a spouse or child) may work in some instances but all have their drawbacks. Some states allow a grantor to create a self-settled asset protection trust, which safeguards assets from creditors and keeps the assets available to the grantor. However, New Jersey law does not allow such trusts. Limited liability companies provide protection for legitimate business or income-producing endeavors, such as a rental property, but not for personal assets. And spouses may be liable for their partner’s debts in certain circumstances. What, then, can be done?

One option to consider is purchasing umbrella liability insurance. An umbrella policy provides additional coverage beyond the limits of homeowners or auto insurance policies. An umbrella policy typically covers the following:

Personal injury

Charitable Residuary Beneficiaries Under a Will

Published on: January 17, 2025 | by James K. Estabrook and Gozde Celik

For many, designating a portion of one’s estate to charities and charitable purposes is an essential and significant part of their Last Will and Testament. Those seeking to make contributions to causes and organizations they are passionate about should be wary of the costs entailed in how such contributions are distributed. Under New Jersey law, when such contributions are designated in the form of a residuary bequest, the State Attorney General is required to exercise its power to protect the public’s interest in charitable gifts and seek costly accounting and lengthy review services, which ultimately drain the estate of funds it could have extended to the aforementioned charitable causes and organizations.

Under N.J. Ct. R. 4:80-6 and R. 4:28-4, the New Jersey State Attorney General is required to review and approve the accounting and administration of an estate when the estate leaves a residuary, or percentage, amount to a charitable organization. The Office of the Attorney General will require the filing of: (1) intermediate and/or final Accounting; (2) statement and calculations of any commissions paid to trustees or executors; (3) final distribution and disbursement schedule of bequests; (4) affidavit of any attorney’s and accountant’s rendered services; and (5) Refunding Bond and Releases executed by the charitable beneficiaries.

After receiving such documentation, the Attorney General’s office must approve the amount the charitable beneficiaries are being given, and such approvals could face backlogs and other administrative delays. Further, a thorough examination into the charitable organization could jeopardize its ability to receive its bequest and could even result in a court redirecting the bequest to a different charity under the cy pres doctrine, as a recent decision in the Appellate Division revealed. See Matter of Estate of Heinecke, No. A-3604-21, 2024 WL 1125186 (N.J. Super. Ct. App. Div. March 15, 2024).

Transfer Tax Exemptions for 2025

Published on: January 17, 2025 | by Anne Marie Robbins

On October 22, 2024, the IRS issued Revenue Procedure 2024-40 setting forth the inflation adjusted transfer tax exemptions for 2025. The Basic Exclusion Amount (BEA) will be $13,990,000. The increase means that in 2025, an individual may make gifts during life or at death totaling $13,990,000 without incurring gift or estate tax; a married couple will be able to transfer $27,980,000 of assets free of transfer taxes. The Generation-Skipping Transfer (GST) Exemption under section 2631 of the Code will also increase to $13,990,000.

The annual gift tax exclusion provided by Code section 2503 will increase in 2025 to $19,000 per donee (or $38,000 if spouses elect gift-splitting).

The gift tax annual exclusion for gifts to non-citizen spouses as set forth in Code sections 2503 and 2523(i)(2) will increase to $190,000.

Corporate Transparency Act Enjoined Again

Published on: December 29, 2024 | by Kelsey Gorman

On December 26, 2024, the U.S. Fifth Circuit Court of Appeals vacated its own order staying the nationwide preliminary injunction of the enforcement of the Corporate Transparency Act (“CTA”) and its reporting deadlines. As it gets closer to the initial deadline of January 1, 2025, the Court has been going back and forth on the status of reporting requirements while pending litigation considers the constitutionality of the CTA.

On December 3, 2024 the Fifth Circuit issued a nationwide preliminary injunction, enjoining the enforcement of the CTA and staying its reporting deadline. However, on December 23, 2024, the Court granted a stay of that injunction, reinstating the reporting obligations and original deadlines. As a result, reporting companies were then put back in a position to file their beneficial ownership information (“BOI”) reports by January 1, 2025. FinCEN, the agency in charge of enforcing the CTA and collecting BOI reports, granted an extension allowing reporting companies to file their BOI reports by January 13, 2025.

However, on December 26, 2024, the Court vacated its December 23, 2024 order and enjoined (again) the enforcement of the CTA and its reporting requirements while it considers substantive arguments over the constitutionality of the CTA. This means that reporting companies do not need to file BOI reports by January 1, 2025 or by the extended deadline of January 13, 2025. As is evident by the three conflicting orders within the past few weeks, things can change at any moment. But, for now, it remains optional for reporting companies file BOI reports.

Social Media in the Hiring Process: Pitfalls and Protections

Published on: December 20, 2024 | by Lisa Gingeleskie

Employers commonly utilize social media to gather information about prospective employees as part of the hiring process. Although social media can be very useful for this purpose, the law on what is permissible use by an employer is underdeveloped. While we wait for the law to catch up to technology, it is imperative that employers are advised as to the existence of certain legal pitfalls when using social media in the hiring process, as well as those practices they can implement to help avoid future liability.

Targeted Advertising

Federal, state and local anti-discrimination laws prohibit discrimination in hiring based on a prospective employee’s protected class. Employers can unwittingly run afoul of these laws, however, when they use social media to recruit or research prospective employees. For example, more and more employers are using targeted advertising to recruit employees. This form of advertising allows employers to use social media platforms, like Facebook, to select a targeted audience based on a range of factors, including age, race and interest. Using the extensive data it collects from its members, social media sites are then able to specifically isolate the employer’s advertisement so that it is shown only to those recipients that fall within the employer’s chosen audience.

To Be Exempt or Not Exempt; That is the Question

Published on: December 20, 2024 | by Lindabury, McCormick, Estabrook & Cooper, P.C.

When hiring, many employers do not give proper consideration to whether newly hired employees should be classified as “exempt” employees who by law are not entitled to overtime pay for hours worked in excess of 40 hours in any workweek, or “nonexempt” employees who are entitled to overtime pay. A failure to properly apply the legal criteria for employee classification can be a costly oversight for employers.

The federal Fair Labor Standards Act (FLSA) mandates that employees be paid on an hourly basis of at least the federal minimum wage, currently $7.25. States and municipalities are free to enact higher minimum wage rates. New Jersey recently passed legislation that will progressively increase the current $8.85 per hour minimum wage to $15.00.

The FLSA further mandates that employees be paid at an overtime rate of not less than 1.5 times the employee’s regular rate for each hour of work time in excess of 40 hours in any one workweek, unless the employee qualifies for one of the exemptions from these overtime requirements set forth in the statute. So how does an employer determine the proper classification of an employee as either nonexempt or exempt? Unfortunately, there are no bright-line rules an employer can rely upon in making these determinations, and the employee’s job responsibilities and the employer’s control over the employee largely dictate the proper classification under the FLSA.