Upcoming Changes to the New Jersey Family Leave Act: Coverage Threshold Lowered Beginning July 2026, by Katharine Fogarty, Esq. and Samantha Pankey Martin, Esq., 2-19-26

New Jersey employers should prepare for a significant change to the New Jersey Family Leave Act (NJFLA) beginning July 2026.  

Under recently enacted legislation, the employee headcount threshold that determines whether an employer is subject to the NJFLA will be lowered, extending family leave protections to a broader range of New Jersey workers.

Key Changes

Currently, the NJFLA applies to employers that employ 30 or more employees for at least 20 workweeks in the current or preceding calendar year. Out-of-state employers are subject to the Act if they meet that 30-employee threshold and have at least one employee working in New Jersey.

Effective July 17, 2026, the employee headcount threshold will decrease from 30 to 15 employees, significantly expanding the number of covered employers. The new law also modifies several eligibility criteria for employees:

• Workers will qualify for job-protected leave after three months of employment (down from 12 months).
• The minimum number of hours worked to qualify will drop from 1,000 to 250 hours during the immediately preceding 12-month period.

Of note, employers should be aware that additional threshold reductions are scheduled. Effective July 17, 2027, the employee headcount threshold will further decrease from 15 to 10, employees. On July 17, 2028, the threshold will again decrease from 10 to 5 employees, resulting in a phased expansion of NJFLA coverage over time.

TDI and FLI Benefit Changes

In addition, recent amendments to the Temporary Disability Insurance (TDI) and Family Leave Insurance (FLI) provisions clarify that any covered individual who takes these benefits will generally be entitled to reinstatement to their former position—or an equivalent role with the same seniority, pay, and benefits—upon expiration of the leave, subject to limited statutory exceptions.

Further, if an employee qualifies for both earned sick leave under New Jersey’s Earned Sick Leave Law and TDI benefits, the employee may choose the order in which the leave is taken. However, an employee may not receive more than one form of paid leave benefit for the same period of time.

What the NJFLA Requires

Covered employers must provide eligible employees up to 12 weeks of unpaid, job-protected leave during any 24-month period for qualifying reasons, including:

• Caring for or bonding with a child within one year of birth, adoption, or foster placement.
• Caring for a family member—or someone equivalent to family—with a serious health condition.
• Caring for a family member (or equivalent) subject to quarantine or isolation during a state of emergency.
• Providing care or supervision for a child whose school or care facility is closed due to a public health emergency.

Interaction With Other Leave Laws

Given the upcoming changes, employers should be mindful of how NJFLA interacts with other leave frameworks including, but not limited to, the federal Family and Medical Leave Act (FMLA) and the New Jersey Earned Sick Leave Law.

Employers covered by both the FMLA and NJFLA must track leave entitlements separately, as the statutes differ in important respects, including the definition of “family member,” which is broader under NJFLA than under federal law as well as the definition of “eligible employee” which includes leave due to the employee’s serious health condition under the FMLA.

Anticipated Regulatory Guidance

Employers should watch for rulemaking in 2026 that clarifies counting methods for remote or multi-state workers, defines how the new threshold will be applied, and updates required employee notices and postings.

Steps for Employers to Consider

Covered employers should begin planning now to ensure a smooth transition to compliance. Key steps to consider include:

• Assessing workforce size and structure to determine whether the new 15-employee threshold applies and looking to the future for further reductions to the employee threshold in 2027 and 2028.
• Updating employee handbooks and leave policies to reflect expanded NJFLA coverage and eligibility criteria.
• Coordinating leave tracking systems for NJFLA, FMLA, TDI, FLI, and any company-provided paid leave.
• Training HR personnel and managers on administering NJFLA leave, documenting leave requests, and safeguarding against interference or retaliation.
• Ensuring recordkeeping systems can accurately track hours worked, employment duration, and leave usage for eligibility determinations.

Key Takeaway

The upcoming threshold reduction marks a major expansion of New Jersey’s family leave protections and underscores the state’s trend toward comprehensive employee leave rights. Employers—particularly those operating near the new 15-employee threshold—should take proactive steps now to revise policies, training, and administrative procedures to ensure full compliance in advance of the effective date.

Authors: Katharine Fogarty is a Partner in KD’s Philadelphia office and Samantha Pankey Martin is an Associate in the Philadelphia office