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Reducing New Jersey Alimony for Unemployment or Lower-Paying Job

If you’re seeking a modification of your alimony or child support payments because you have lost your job or have taken a new job for considerably less money, know that the court is going to scrutinize the extent of your job search and/or reasonableness of accepting the job you did take.

This is one reason our New Jersey alimony lawyers urge clients to be very cautious when signing off on their marital settlement agreement. Getting anything changed after the fact will take time, expense – and is no guarantee.

There is a process by which aspects of the agreement like spousal support, child support, parenting time or contribution of shared debts can be later altered, but it requires evidence of a substantial change in circumstance.

Losing a job or taking another job that pays substantially less do qualify as a substantial change in circumstance. It wasn’t always so (at least for short-term unemployment and where alimony was concerned). The change is thanks to alimony reform legislation passed in 2014 reflected in N.J.S.A. 2A:34-23(k). Now, the payor must wait 90 days after losing employment/income before filing for a modification. The court has discretion about whether to grant any relief retroactively.

Courts generally want to avoid situations where dependents don’t receive support they need because the obligated payor made selfish choices. As noted in the 1982 case of Arribi v. Arribi, a person cannot find and choose to remain in a position with diminished or no earning capacity and expect to be relieved of the obligation to support their family. He/she “cannot be content with waiting for the right job to appear when (s)he is obligated to pay support…”

Test for Non-Self-Employed Party Requesting Alimony Modification

If you seek to lower or eliminate the alimony you’re paying your ex due to your employment status, the 2014 law obliges the court to consider:

  • Why was your income lost or reduced?
  • What efforts have you made to find a new job or pursue a new career path?
  • Have you made a good faith effort to find a new job?
  • How healthy are you, and how does this impact your ability to find a steady job?
  • Has your former spouse’s financial situation changed at all since the alimony order?
  • How long will it take the recipient to improve his/her earning capacity to the point alimony is no longer needed?

Courts are also given discretion to weigh “any other factor deemed relevant and appropriate.”

The 2016 case of Mills v. Mills before the Superior Court of New Jersey in Ocean County added the reasonableness consideration.

Mills v. Mills – Reasonability of Accepting Lower Paying Job

In Mills, a man paying alimony requested reduction of those payments on the grounds that his salary was slashed by more than one-third – from $108,000 to $70,000 annually.

The pair had been married 13 years, had two children together and the marriage settlement agreement required alimony and child support totaling $2,120 monthly.

But then he lost his job when his employer of 12 years restructured the company, eliminating his position. He was given a $35,000 severance package and started his job search soon after. Four months later, he was offered another job – one that paid almost $40,000 less. He decided to take it.

He continued paying alimony and child support as he had, until several months later when the severance pay from his previous employer ran out. That’s when he sought to modify the marriage settlement agreement by ending alimony and reducing child support, asserting that continued payments at the same level presented an economic hardship for him.

His former spouse objected to this, saying his income potential was still well over $100,000 and he hadn’t proven that he was unable to keep earning that much. During a contested hearing, the former husband explained he’d started his previous job at a salary of $50,000 annually. He’d gradually worked his way up the pay scale within the company as a valued employee – a process not automatically or easily duplicated at a new firm.

The court noted that cases like Arribi and others led to various standards, considerations and conclusions in determining when to modify alimony. The 2014 law provided some clarification where a W-2 employee loses his/her job and seeks reduction in alimony, but how did this reconcile with prior conflicting case law?

In answer, the court devised a two-step inquiry for these situations:

  • Was the supporting spouse’s choice in accepting a new job objectively reasonable based on the totality of the circumstances?
  • If so, what if any resulting support adjustment should occur that is both fair and reasonable for both parties involved?

Based on this test, as well as the criteria outlined in the 2014 statute, the court found the man’s choice to take the lower-paying job was reasonable considering all other factors and granted him modification of his alimony payments.

In another more recent case, Sowa v. Sowa, before the Superior Court of New Jersey Appellate Division in 2017, a man sought modification of his alimony and child support obligations – and was denied. The court determined the man had not exhausted his job search in good faith before he applied for a reduction.

He’d been unemployed at the time of divorce and remained so for nearly two years after. The reason the judge found this search inexhaustive was because he’d effectively limited himself to accepting a job in his chosen field that paid at least $100,000. He didn’t explore employment in all fields at all levels.

If you’re looking to have your alimony or child support awards adjusted, consult with an experienced family law attorney who can help you determine what evidence must be gathered to effectively prove your position.

To learn more about filing for divorce in New Jersey, contact Rozin | Golinder Law today at (732) 810-0034.

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