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NJ Legislators Pass Multiple Misclassification Bills - Pushed by Governor Murphy

24 Jun 2021 3:57 PM | Anonymous member (Administrator)

With less than a week's notice, multiple misclassification bills were introduced and passed out of both the Senate and Assembly Labor Committees.

S-3920, would provide the Commissioner of Labor and Workforce Development (LWD) greater enforcement powers in regards to violations of state wage, benefit and tax laws. It would also provide additional enforcement options in the Office of Administrative Law and in the courts through subpoena powers and injunctive relief.

This bill would permit the Commissioner to issue a stop-work order for one or more worksites, or across all the employer’s worksites. The orders remain in effect until the Commissioner finds that the employer has come into compliance and has paid any penalties assessed.

S-3921, would create the “Office of Strategic Enforcement and Compliance” within LWD. It would oversee and coordinate across the divisions of the department and, when necessary, between the department and other state agencies and entities, for strategic enforcement of state wage, benefit, and tax laws, as deemed appropriate by the Commissioner.

The bill would appropriate $1 million from the General Fund to the department to support and expand the Office of Strategic Enforcement and Compliance.

The third bill, S-3922, would streamline the identification of employee misclassification. Specifically, the bill would make misclassifying employees for the purpose of evading payment of insurance premiums a violation of the New Jersey Insurance Fraud Prevention Act. The Act is currently silent on misclassifying employees as a form of insurance fraud.

The bill would specify penalties for fraud when misclassification occurs as $5,000 for the first violation, $10,000 for the second violation and $15,000 for each subsequent violation.

Identical bills were also passed in the Assembly (A5890/5891/5892)

The bills passed out of the Assembly 6/21. Should be on Senate list for 6/30 vote.

NJMTA Comments

Listen to Labor Committee Hearings - excellent presentation by our lobbyist


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