- within Employment and HR topic(s)
- with Senior Company Executives, HR and Finance and Tax Executives
- in United States
- with readers working within the Accounting & Consultancy, Basic Industries and Business & Consumer Services industries
Summary
As we enter into 2026, employers should be aware of several recent and upcoming legislative changes that may affect workplace policies and practices. Below is a summary of key developments in New Jersey and New York. We recommend that employers review and update employment policies now to ensure compliance.
NEW JERSEY
Minimum Wage Increases for 2026
Beginning January 1, 2026:
- The New Jersey minimum wage rate for most employees increased by $0.43 to $15.92 per hour.
- The minimum wage rate for employees of seasonal employers, and employers of five or less employees, increased from $14.53 to $15.23 per hour, and will continue to increase annually until 2028.
- The minimum cash wage for tipped workers increased on January 1, 2026, from $5.62 to $6.05 per hour. The maximum tip credit that employers may claim under New Jersey law will remain $9.87 per hour.
Pay Transparency Ramps Up in New Jersey
New Jersey's pay transparency law (which took effect June 1, 2025) applies to employers with 10 or more employees and requires job postings for new jobs and transfer opportunities advertised by the employer internally or externally to include:
- The applicable hourly wage, salary, or a range of hourly wage or salary; and
- A general description of benefits and other compensation programs for which the employee would be eligible.
These employers must also make reasonable efforts to announce, post or otherwise make known promotion opportunities that are advertised internally or externally through certain methods to all current employees in the affected department before making a promotion decision. Regulatory scrutiny and enforcement activity are expected to increase in 2026. Employers should review postings for these opportunities to confirm compliance, and assess whether compensation structures can be supported if challenged. Employers who do not comply may face monetary penalties.
The NJLAD Protections Extend to Out-of-State Remote Employees
New Jersey enforcement guidance has now clarified that the New Jersey Law Against Discrimination (NJLAD) applies to employees outside the state who work for New Jersey-based employers.
With the rise of remote work, employers may expect broader enforcement of this guidance in 2026. Employers should evaluate, and if necessary, update, their anti-harassment training programs, internal complaint procedures, and manager guidance to ensure they address issues related to remote and multi-state workforces.
Expanded Enforcement Expected Under New Jersey's Temporary Workers' Bill of Rights and Domestic Workers' Bill of Rights
Enforcement of New Jersey's Temporary Workers' Bill of Rights and Domestic Workers' Bill of Rights is expected to increase in 2026.
Employers that rely on temporary health service firms to staff covered job categories or engage domestic workers, including household employers, should confirm that notices, contracts, wage practices, and working conditions align with statutory requirements.
NEW YORK STATE
Minimum Wage Rises
Beginning January 1, 2026, New York employers must implement the following minimum wage rates:
- $17.00 per hour for employees in New York City, Westchester, and Long Island
- $16.00 per hour for employees in the remainder of New York State
Increases in the tip credit, minimum cash wage, meal allowance, lodging allowance and uniform allowance are effective then as well. The updated rates apply to all employers statewide, regardless of size. Employers with employees in more than one region should verify that job postings, payroll systems, offer letters and internal compensation practices are aligned with the applicable local rate.
Overtime Exemption Salary Thresholds Will Rise in 2026
Effective January 1, 2026, New York employers must satisfy the following minimum salary levels in order to maintain the overtime exemptions for executive and administrative employees:
- New York City, Westchester, and Long Island: $1,275.00 per week (approximately $66,300 annually)
- Rest of New York State: $1,199.10 per week (approximately $62,353 annually)
Employers should evaluate exempt positions to determine whether salary adjustments are necessary or whether reclassification may be required.
Compliance with the Applicable Provisions of the Retail Workplace Safety Act
Effective June 2, 2025, employers of ten or more retail employees working in New York State were required to adopt and distribute a retail workplace violence prevention policy and provide their employees with interactive retail workplace violence prevention training. These requirements cover retail employees who work in a store that sells consumer commodities at retail, and which is not primarily engaged in the sale of food for consumption on the premises. Additional requirements relating to silent alarm buttons, applicable to all retail employers with 500 or more employees, take effect beginning January 1, 2027.
2025 Changes That Should Be Reflected in 2026 Handbooks and Policies
As part of their 2026 planning, employers should review their employee handbooks and internal procedures to ensure they reflect recent changes, including:
- The requirement to provide 20 hours of paid prenatal leave (under both New York State and New York City law)
- The provision of paid 30-minute lactation breaks for up to three years following the birth of the child
- Implementation of the Clean Slate Act, which seals certain criminal convictions after designated time periods
NEW YORK CITY
Significant Updates to NYC Safe and Sick Leave
Effective January 1, 2025, New York City's Earned Safe and Sick Time Act (ESSTA) was amended to require that covered employers provide a separate bank of 20 hours of paid prenatal leave for employees. As a result, the New York City Department of Consumer and Worker Protection issued a new Notice of Employee Rights: Safe and Sick Leave, dated May 30, 2025, reflecting paid prenatal leave. Employers should ensure their current and newly hired New York City employees have been, and are, issued the current Notice.
Effective February 22, 2026, amendments to ESSTA will substantially expand employee leave rights. Employers should plan to update their leave policies and required notices, and train managers on the new requirements.
Key changes will include:
- New unpaid leave entitlements
- Expanded definitions of qualifying "safe" and "sick" time
- Additional circumstances under which leave must be provided
- Changes affecting coordination with the New York City Temporary Schedule Change Law
NOTE: A.Y. Strauss will issue further guidance in January outlining these changes and recommended compliance steps.
Ongoing Compliance Obligations Under NYC's AI Hiring Law
New York City's Automated Employment Decision Tool (AEDT) law remains in effect and continues to impose ongoing compliance obligations on covered employers using certain AI-driven tools in hiring or promotion decisions.These obligations include:
- Annual independent bias audits of covered tools
- Public disclosures regarding the most recent audit and the distribution date of a covered tool before its use
- Providing required notices to candidates and employees
Employers should confirm that third-party vendors can support compliant audits, ensure audit summaries are properly published, and review internal procedures and notices for ongoing compliance.
New NYC Pay Reporting Mandate
Newly enacted legislation, effective November 4, 2025, has broadened New York City's pay transparency requirements for employers with 200 or more employees in New York City at any time during the reporting year. This requirement will be enacted as follows:
- By December 4, 2026, the Mayor will designate an agency to perform a pay equity study of covered employers
- Within one year after the agency is designated, it should develop a form to be used by covered employers to submit pay reports
- Within one year after the pay report form is published by the designated agency, and annually thereafter, covered employers must submit pay reports to the covered agency
These pay reports must include current information corresponding with the categories of information required by the EEOC in its EEO-1 component 2 reporting requirements for reporting years 2017 and 2018 on W-2 income earnings, aggregated into pay bands, by race/ethnicity, sex and job category. The designated agency may adopt modifications, such as reporting options for different gender identities.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
