New Jersey is cracking down on worker misclassification regarding independent contractors. Back in May 2018, Governor Phil Murphy created the Task Force on Employee Misclassification to identify the practice, which he calls unfair and illegal. On Tuesday, he signed bill S-2557, which enables the Department of Labor and Workforce to force job sites to shut down or be penalized with a $5000 per day fine if they violate wage laws. Independent contractors who are misclassified as non-employees cannot earn overtime after 40 hours, receive Workers’ Compensation or unemployment benefits, sick leave, or family leave, or get health insurance through their employers. While some of the reforms are being put into place; others will require legislation to reinforce the rules.
Worker misclassification of independent contractors is a form of wage discrimination. It denies workers from receiving the benefits and wages to which they are entitled after performing various, consistent assignments for businesses. Many industries including construction, cleaning services, home care, transportation, trucking, and delivery services, among others, classify workers as independent contractors.