The Legislature has recently enacted a law sought by Govenor Christie which significantly limits an employee's eligibility for unemployment compensation in the event of a temination. The issue has gone unnoticed by many employees and the media, and we are accordingly bringing it to your attention.
Many employees believe that they are automatically entitled to unemployment if they are terminated. In fact, that is not the case. Current law provides that if an individual is fired for "misconduct", there is a six week ineligibility period before unemployment may be collected. If the employee engages in "gross misconduct", the individual is not entitled to any unemployment whatsoever. "Gross misconduct" has generally been interpreted to mean actions that rise to the level of a "crime" as defined by the New Jersey Code of Criminal Jusitce.
Recently, however, the Legislature added a third level of unemployment ineligibility, known as "severe misconduct". Under this standard, if the employer contends that the termination was because the employee engaged in "severe misconduct", the employee is completely barred from collecting any unemployment compensation. Thus, the question is what would constitute "severe misconduct", and how does it differ from "gross misconduct".
Under the new Law, "severe misconduct", can involve offenses which certainly would not previously have resulted in disqualification from unemployment. The statute states that "severe misconduct" may include: 1)repeated lateness or absences after written warnings; 2)repreated violations of an employer's rules or policies; 3)misuse of sick time; 4)theft of time; and "other similar examples". Put differently, under the new law, employees who would have been eligible for unemployment upon termination may now be ineligible if the employer contends that the employee engaged in "severe misconduct" as described above.
Accordingly, it is very important for employees to understand the exact reasons for their termination, and whether their employer will allege that the employee engaged in "severe misconduct" or "gross misconduct". If so, the employee will not only be terminated, but may find that he/she is not eligible for unemployment.