In Spring 2023, the New Jersey Senate introduced Bill 3818 (“S3818”), aiming to amend the New Jersey Workers’ Compensation Act to impose a mandatory award of attorneys’ fees to prevailing claimants equal to 25 percent of any recovery. Currently, the Act permits judges to order a discretionary award of attorneys’ fees no greater than 20 percent of the recovery, which can be apportioned to the claimant’s employer. The New Jersey Civil Justice Institute (NJCJI), part of a business coalition opposing this bill, submitted a memorandum arguing that statutory fee-shifting arrangements must involve judicial assessment of whether the fees sought are reasonable. Due to these efforts, the Senate Labor Committee announced it would not conduct a hearing on S3818, and its Assembly counterpart was withdrawn in late Spring.
The Assembly counterpart was replaced by “Establishes 21st Century Injured Workers’ Access to Justice Act” (“A5659/S4059”). This new bill would impose a 25% cap on fee awards but with limited judicial discretion. It ostensibly retained judicial discretion but prohibited judges from considering hours worked or attorneys' hourly rates in assessing fee awards' reasonableness.
During hearings before both legislative committees, NJCJI argued that barring judges from considering hours worked and rates charged would lead to a de facto 25 percent mandatory award as judges would lack basis for estimating reasonable fees. Despite opposition efforts, A5659/S4059 was voted out of both committees and is currently on the floors of both Houses for consideration.
NJCJI also opposed bills A5794/S1438, which allow labor unions to file civil lawsuits on behalf of non-union workers for unpaid wages within construction trades. Under current law, only specific entities may file such suits on behalf of union workers in this industry. NJCJI expressed concerns that the bill could create opportunities for unlimited union litigation without guardrails.
The bill was amended twice in response: first prohibiting unions from filing lawsuits if collective bargaining agreements were present between workers and employers; second requiring written consent from workers for such suits. However, NJCJI maintained fundamental concerns about potential misuse despite these amendments. The legislation passed both Houses with bipartisan support during the lame duck session and awaits consideration by Governor Phil Murphy.
Additionally, NJCJI opposed bills A4961/S3572 seeking legislative sanction for mass arbitration—a tactic where plaintiffs' lawyers recruit large numbers of consumers to file identical arbitrations against businesses—arguing it extracts massive settlements without merit consideration due to upfront arbitration initiation fees charged by providers.
NJCJI provided written comments and oral testimony before relevant legislative committees opposing this tactic's preservation through outlawing bellwether clauses in consumer contracts designed by businesses to limit multiple simultaneous arbitrations brought by an attorney.
