New Jersey DOL Issues Proposed Rule Allowing Time Rounding

On July 6, the New Jersey Department of Labor (NJDOL) issued proposed rule N.J.A.C. 12:56-5.8 concerning the use of time clocks and rounding practices by employers. Noting the confusion caused by the discrepancy between the state rules (which require payment for “all hours worked”) and the federal rules (which pursuant to 29 CFR 785.48, permit rounding), the NJDOL’s proposal simply calls for a verbatim adoption by the state of the federal rules on this issue. Thus, under the proposed rule:

• When time clocks are used, employees who voluntarily punch several minutes early or late, but do not engage in work during such extra periods, need not be paid for such minor discrepancies between the schedule and time clock; and
• Rounding (such as recording the employees’ starting time and stopping time to the nearest five minutes, or to the nearest 1/10 or quarter of an hour) is permitted provided it is not used in a manner that would result, over a period of time, in failure to compensate the employees properly for all the time they have actually worked.