New Jersey employers aren’t required to pay employees extra money for coming up with good ideas related to their work. That’s because the state’s “shop right” doctrine says employers aren’t obligated to pay additional compensation for “ideas, knowledge, experience and performance in coming up with a viable process.” But take note: You still may face claims for using employees’ ideas that are NOT related to their regular jobs.
Recent case: Gedion Teklewolde, an engineer, sued after Onkyo USA fired him. He alleged theft of his idea for a “Power Plus” product. The court dismissed his compensation claim. Because his product idea related to his engineering job, he couldn’t sue for extra pay. (Teklewolde v. Onkyo USA, No. 06-1097, DC NJ, 2006)
Tip: If you use a suggestion box, it may be wise to include language on the form that explains your compensation terms for ideas used, and obtain employees’ consent to those terms.