New Jersey has become the first state to guarantee severance pay for mass layoffs, according to the bill’s sponsors and the governor’s office, the Associated Press reported. Gov. Phil Murphy (D) signed legislation on Tuesday that requires companies with 100 or more full-time employees to pay them a week’s pay for each year of service during a mass layoff, plant closing or transfer resulting in 50 or more workers losing their jobs. The law also increases the minimum number of days notice from 60 to 90 for such events. The legislation was motivated by last year’s closing of Toys “R” Us, which cost 2,000 employees their jobs in New Jersey. Two of the private equity firms that owned the retail giant eventually established a severance fund. The new law has its critics. The New Jersey Business and Industry Association, which lobbies state government on behalf of businesses, said the law will take effect just as other requirements like a higher minimum wage and increased taxes are hitting. The association said in a statement that the legislation makes New Jersey less competitive. The legislation passed along party lines, with Democrats in favor and Republicans opposed. The law goes into effect in July.
