Classification of employees addressed with new laws in New Jersey

Classification of employees addressed with new laws in New Jersey

On Behalf of | Aug 5, 2021 | Employment Law |

Worker classification has long been a concern in New Jersey. If an employer does not property categorize a worker, it can negatively impact their pay, benefits, access to workers’ compensation coverage and other protections they should be accorded as employees. For a long time, employee advocates and legislators have sought to find solutions to the problem of misclassification. Workers who might be worried about whether they are classified as employees or independent contractors should be aware of new laws that were signed by the governor.

New laws for worker classification will be implemented in New Jersey

New Jersey Governor Phil Murphy sought to address worker misclassification by signing a series of new laws. Among the laws passed is one that will give the commissioner of labor and workforce development more leeway to enforce violations. Regarding enforcement, there will be a new entity called the Office of Strategic Enforcement and Compliance. With it, there will be a payroll tracker so employee misclassification can be more easily spotted and prevented. Another law will bar employers from misclassifying employees just so they can evade the requirement that they make insurance payments.

In New Jersey, there is a presumption that a person who performs services and receives payment for it is an employee. The employer is required to prove that the person is not an employee in three ways. First, the employee must not be under the control or direction of the employer. Next, the service the person is providing the employer must be done outside the normal business of the employer. For example, if it is a clothing retailer and a person is hired to paint, then that person is likely an independent contractor since there is no connection between the clothing business and what the painter is doing. Finally, the person who is performing the work usually performs his or her duties independently. These rules are generally called the “ABC” test to determine a worker’s status.

Employees should be aware of the new laws in case there is a violation

Since classification of employees plays such an important role in so many issues that frequently arise in the context of employment, it is imperative that workers who believe they are misclassified understand their rights. This is especially true with these new laws. Proper classification is crucial in many aspects of employment including wages, benefits and if there are workplace injuries. If there is confusion or an outright dispute, it is wise to have assistance with seeking a fair resolution and getting what an employee is entitled to.