Assemblywoman Vicky Flynn has introduced a concurrent resolution in the New Jersey General Assembly that aims to overturn proposed changes by the Department of Labor and Workforce Development (DOL) regarding independent contractor classification. The resolution, ACR-177, mirrors SCR-138, which was previously introduced in the Senate by Senator Declan O’Scanlon, Jr.
The DOL is seeking to revise the criteria used to determine whether a worker is classified as an independent contractor or an employee. During public hearings on these proposed changes, more than 9,500 comments were submitted, with 99% expressing opposition.
If both legislative chambers pass the concurrent resolutions, they would not require the governor’s signature. The DOL would then have 30 days to modify or withdraw its proposed rules. If it does not comply, the Legislature could take further action to invalidate all or part of the rules under state constitutional authority.
New Jersey law currently uses a three-part “ABC test” for determining employment status for unemployment compensation purposes. The DOL argues that its proposal will codify existing regulations and help reduce worker misclassification.
However, business organizations including the New Jersey Business & Industry Association (NJBIA), along with other groups and independent contractors, argue that the new rules would make it significantly harder for individuals to operate as independent contractors. They say this could negatively impact various professions such as trucking, driving services, freelance writing, arts, and financial advising.
NJBIA President & CEO Michele Siekerka commented on the issue: “The DOL proposal effectively flips the ABC test into an ‘employment presumption’ standard, which is inconsistent with New Jersey’s judicial precedents.”
“We need to ensure the flexibility and the economy of independent contractors and stop looking to add costs and burdens to New Jersey businesses,” Siekerka said on Sept. 8.
