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Township’s Minimum Wage Violations Date Back 12+ Years

Cranbury's Practice of Paying Second-Year Summer Camp Counselors Less Than The Federal Minimum Wage Doesn't Hold Up
Davidow, Taylor, Mulligan
Mayor Jay Taylor, flanked by Parker McCay lawyer Daniel Davidow, and Comitteeman Dan Mulligan III. Charlie Kratovil

CRANBURY, NJ—According to public records, the Township's Recreation Department appears to have illegally underpaid as many as 46 employees since 2006.

Counselors for the department's summer camp program were paid at rates as low as $3 per hour, in violation of the minimum wage set forth by the federal Fair Labor Standards Act.

Municipal officials defended their practices, which records show have been in place for many years.  But attorneys for the Township have been unwilling to back them up.

It's not clear how much further back the apparent violations might go, and officials declined to address the issue directly at the February 11 Township Committee meeting.

The 46 employees identified by New Brunswick Today are owed between $50 and $1,000 each, totalling somewhere between $15,000 and $17,000.

This reporter discovered the violations after speaking with Township officials and auditing records provided by the Township Clerk's Office  in response to our Open Public Records Act (OPRA) requests filed using OPRAmachine.com.

The Township's intitial response showed seven employees paid either $5 per hour or $5.50 per hour during the 2018 summer program, even though the state minimum wage was $8.60 per hour and the federal minimum wage was $7.25 per hour.

The low pay rates, which stood out among Middlesex County's 25 municipalities, sparked questions about those employees and the justification for paying less than minimum wage.

As it turns out, municipal governments and other public institutions were completely exempt from the state's minimum wage law, that is until new legislation was signed by Governor Murphy on February 4 that, for the first time holds local governments to the same standards as private businesses.

But some Cranbury officials were apparently mistaken about the applicability of the federal minimum wage law, and those calling the shots never checked with an attorney to make sure their pay rates were in compliance with the Fair Labor Standards Act (FLSA).

"All of those employees listed with an hourly rate less than $8.85 which fall under Recreation are seasonal camp counselors and as such are not required to be paid minimum wage per the Department of Labor," Business Administrator Denise Marabello, who has been with the Township government since 1996, told us after we reached out to Mayor James "Jay" Taylor for an explanation of the discrepancy on February 1.

"I believe there is a federal [exemption]... but I'm not 100% sure," Marabello told New Brunswick Today, citing Recreation Director Ken Jacobs as her source on the federal exemption.

"Our Rec Director is the one who I checked with, and he has assured me that what we are paying them is correct," said Marabello.  "And he's a Recreation Director for other towns, too, so he knows."

Jacobs, who also works in the same role for neighboring West Windsor Township, explained that he was relying on a provision within the FLSA that allows young workers to be paid less than the $7.25 standard minimum wage.

Under the FLSA, teenage employees can be paid as low as $4.25 per hour, a rate known as the "youth minimum wage," but only for their first 90 days with any given employer.

Cranbury, however, has been paying first-year camp counselors $5 per hour, only to re-hire them the following summer at $5.50 per hour, violating the 90-day limit that is supposed to apply.

Jacbos said he believed the "90-day clock re-starts" when the counselors are re-hired for their second summer camp, but the US Department of Labor (USDOL) has been clear that is not how the policy is supposed to work.

"A break in service does not affect the calculation of the 90-day period of eligibility," reads a USDOL fact sheet on the youth minimum wage.

"In other words, the 90-calendar-day period continues to run even if the employee comes off the payroll during the 90 days."

"If [a student initially works for an employer over a 60-calendar-day period in the summer and then quits to return to school]... were to return later to work again for this same employer, the period of eligibility for the youth wage will have already expired."

This means that, for years, Cranbury has been illegally underpaying its second-year counselors by $1.75 per hour.

During a phone interview, Jacobs admitted that he was basing the low pay rates on his own interpretation of the FLSA, and not a legal opinion provided by a Township attorney.

"That's my interpretation of this.  I haven't asked for an opinion," said Jacobs.  "I'm fairly confident that other towns probably do it similarly."

On February 5, this reporter brought the issue to the attention of Township Attorney Steven Goodell, of the firm Parker McCay.

"Thank you for your email. I appreciate your concerns," Goodell wrote.  "Obviously, I cannot comment; any advice I give my client is confidential."

When this reporter presented these findings to the Township Committee in public, most officials exercised their right to remain silent.

Asked if the Township administration would commit to paying at least $8.85 per hour, the new state minimum wage, Mayor Taylor did not respond.

"I have to jump in.  I'm not going to allow the Mayor to answer that question," stated Daniel Davidow, another lawyer at the Parker McCay firm.

"These are legal questions and legal issues that you've raised, and matters involving attorney-client advice and personnel matters are properly discussed in closed session."

But the Township Committee did not enter a closed session to discuss the matter, and their attorney declined to state his opinion on the applicability of the youth minimum wage to second-year camp counselors.

"I'm gonna be looking into it," said Davidow.  "I'll advise the committee accordingly."

One member of the Committee, the only Republican on the body, responded to the presentation by criticizing this reporter for doing "gotcha stuff on camera."

"It's amazing times we live in: 2019.  You know, we have a person come here and raise an issue and, you know, they're a former political candidate in New Brunswick," said Mulligan, referencing this reporter's 2018 campaign for Mayor of the Hub City.

"They jump on Twitter and they say they gotcha, they got a town, you know, doing something wrong. Then they show up and film it tonight," continued Mulligan. "It's an interesting world that we live in. It's not the world I enjoy," continued Mulligan.

Mulligan's comments sparked a critique from one member of the public, who accused the Committeeman of filming a portion of a previous Council meeting and sharing it on his Facebook page.

"Everyone is welcome to come here and film anytime they want at a meeting.  It's just the whole premise of the set-up that I find unsettling," said Mulligan.

Only one member of the five-person, all-male committee spoke about having a desire to comply with the law.

"From my perspective, gotcha moments aside, I think that whatever the law is, that we will adhere to it.  I would like us to," said Committeeman Matt Scott.  "You should follow up with us in a year.  I'm sure we will."

Records provided by the Township two days later show that they previously paid some returning counselors even less than $5.50 per hour prior to 2011, and some counselors were paid as low as $3 per hour in both 2006 and 2007.

For the first time, this summer the program will be required to comply with the state's minimum wage law

Recreation Director Jacobs says, "That could affect how we even look at our summer camp employees, period," adding he may opt to expand the existing unpaid "counselor-in-training" program.