N.J. Could Be First State to Approve Law Inspired by Toys ‘R’ Us

(Bloomberg) -- New Jersey took one step closer to broadening the rights of workers on Monday when the state Assembly passed a bill inspired by the bankruptcy of Toys “R” Us Inc.

The law would require one week’s pay for each year of employment for workers in the event of mass firings from companies with more than 100 employees. It also would extend the employee-notice period to 90 days from 60 days.

The Assembly vote was 55-21. The legislation, the first of its kind in the country, now goes to Governor Phil Murphy, a Democrat who campaigned on strengthening economic security for the middle-class and has had wide support from labor unions.

When the Wayne, New Jersey-based Toys “R” Us liquidated in 2018, more than 30,000 workers found themselves suddenly jobless with no claim to severance payments. The campaign they launched in response caught the attention of U.S. lawmakers, public and private investment funds and presidential candidates. It also helped spark a national conversation about the treatment of workers in private-equity buyouts.

The bill, which passed a Senate vote in December, was co-sponsored by Democratic state senators Nellie Pou of Paterson and Joseph Cryan of Union.

Cryan began working with groups including Make the Road and United for Respect to draft the guaranteed severance bill, which he introduced in November 2018.

“Toys ‘R’ Us was certainly a driving influence for this bill,” Cryan said in an interview Friday, explaining that he attended a worker rally at a store in his hometown in June 2018 and was motivated by speaking to the employees he met there.

“It helps to put faces to the story,” Cryan said.

To contact the reporters on this story: Eliza Ronalds-Hannon in New York at eronaldshann@bloomberg.net;Lauren Coleman-Lochner in New York at llochner@bloomberg.net

To contact the editors responsible for this story: Rick Green at rgreen18@bloomberg.net, Bob Ivry, Larry Reibstein

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