Newark, N.J. (May 8, 2023) – The misclassification of workers as independent contractors rather than employees has been at the top of the list for legislators, regulators, and plaintiffs' attorneys in recent years. Relatedly, attention has focused on the protection of temporary workers. New Jersey has now taken a major step designed to provide pay equity by protecting certain temporary workers who may often not receive comparable pay and other benefits.
On February 6, 2023, New Jersey Governor Phil Murphy signed a new law known as the "Temporary Workers' Bill of Rights." While this law is primarily focused on pay equity for workers employed through temporary help service firms, it also establishes additional rights for temp workers. The law is going into effect in stages. Most of the law's requirements are effective as of August 5, 2023, but two important provisions became effective on May 7, as explained below.
Who the Law Covers
Importantly, not all temporary workers are covered. The law limits its scope to workers in a "designated classification placement," which means work in these specific occupational categories as defined by the Bureau of Labor Statistics: protective service workers; food preparation and service; building and grounds cleaning and maintenance; personal care and service; construction laborers and helpers; installation, maintenance, and repair; production; and transportation and material moving.
Wage & Hour and Other Payment Considerations
The law requires that temporary service firms pay covered workers at least the same average rate of pay and equivalent benefits as permanent employees performing the same or similar work on jobs that require equal skill, effort, and responsibility. The firm must also pay the "average cost of benefits, or the cash equivalent thereof." The specific wages must be set forth in an itemized statement that includes the name, address, and telephone number for the third-party client, the hours worked each day, the rate of pay, and the amount and purpose of any deductions. Temp workers may request that the service firm hold their daily wages and provide biweekly paychecks. The law also prohibits pay deductions for meals and equipment that would reduce workers' pay below minimum wage. If the worker is assigned by the temp firm on a particular date, but the client does not have work for the individual, the temp firm must pay a minimum of four hours or assign the worker to another location.
Additionally, temporary service firms and third-party clients are prohibited from charging various fees to temporary workers, including for transportation to and from the work site and for consumer reports, background checks, or drug tests.
Further with respect to transportation to work sites, if the temporary service firm provides transportation to the site, it must also provide transportation back to the point of hire. The law also imposes safety requirements for any transportation provided by the firm as well as joint liability for damages incurred for the firm and the party that the firm utilizes to transport the worker to the work site.
New Required Notices & Information
Temporary service firms are also now required to provide at the time of hire "common sense information" detailing key terms of employment such as hours worked and rate of pay. This provision became effective May 7. The notice should be in English and the employee's primary language. Temp firms should utilize a New Jersey Department of Labor and Workforce Development form for this notice. Firms must provide a new notice if the terms of employment change. In the same regard, the firm must provide written notice of any changes in schedule, shift, or location within 48 hours. Temp firms that violate the notice requirements are subject to a fine of not less than $500 and not more than $1,000 for each violation.
The temp firm must post in an accessible location a notice regarding the law that includes a phone number for complaints. The notice should be in English and any other language generally understood in the firm's locale. The Department of Labor is expected to issue the wording for these notices.
Provisions to Encourage Hiring for Permanent Positions
The law seeks to encourage hiring of temp workers for permanent positions by eliminating common obstacles. Temporary service firms may not restrict a worker's acceptance of another position with a permanent employer or third-party client. Temp service firms can charge a placement fee to the client, but the fee cannot exceed the total daily commission rate that would have been received for the individual's work over the prior 12 months. Additionally, reporting requirements for permanent placements have been established, with penalties up to $5,000 for violations.
Prohibition on Retaliation
Further, effective May 7, the temporary help service firms and their third-party clients are prohibited from retaliating against temporary workers for exercising their legal rights. Protected activity under the law includes making a complaint that the law has been violated, commencing a proceeding under or related to the law, and testifying or preparing to testify in such a proceeding. Notably, the law establishes a private right of action for damages, penalties, and costs. A six-year statute of limitations applies running from the final date of employment or the date the firm and third-party client's contract is terminated. Termination within 90 days of the worker engaging in protected activity establishes a rebuttable presumption that the termination was retaliatory. Additionally, various penalties may be assessed for violations of the other provisions of the Bill of Rights.
Employes that utilize temporary service firms may want to request that such firms advise about their measures to comply wih the Temporary Workers' Bill of Rights
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
