On February 6, 2023, New Jersey’s Governor Phil Murphy signed the Temporary Laborers’ Bill of Rights into law, which will impact over 127,000 temporary workers in the state as well as their employers. Most provisions of this law take effect on August 5th, while the notice and anti-retaliation provisions will be effective May 7th. Employers must be prepared to take action to ensure that they properly follow the new law within the next month.
The new law will apply to staffing firms that (a) coordinate the assignment of “individuals to assist the firm's customers in the handling of [their] temporary, excess or special workloads,” in New Jersey; (b) “who, in addition to the payment of wages or salaries to the employed individuals, pay[sic] federal social security taxes and State and federal unemployment insurance;” (c) “carr[y] workers’ compensation insurance;” and (d) sustain “responsibility for the actions of the employed individuals while they render services to the firm’s customers.”
The temporary workers covered by this bill include those currently designated by the U.S. Department of Labor’s Bureau of Labor Statistics as other protective service workers (miscellaneous manufacturers); food preparation and serving related occupations; building and grounds cleaning and maintenance operations; personal care and service occupations; construction laborers; helpers, construction trades; installation, maintenance, and repair occupations; production occupations; and transportation and material moving occupations. The provisions of the new law will likely cause logistical and administrative headaches for staffing firms due to the multitude of ambiguous compliance obligations and lack of implementation guidance.
Notable Provisions Effective May 7th
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Notice Requirements
On the first day of an assignment or if there is a change in terms, staffing firms must provide the laborer with written notices in both English and the individual’s primary language that outline details of the contract, including the name of the client, the nature of the work, the schedule and terms of the work, and the amount and terms of sick leave. Any notice of scheduling, shift, or location changes must be provided 48 hours in advance of such change. Additionally, firms must provide itemized statements on paycheck stubs or a form approved by the New Jersey Commissioner of Labor and Workforce Development and, at the end of a single-day contract, must provide a work verification form. Finally, staffing firms must post a notice in both English and any other language generally understood by the laborers at the firm of the law’s requirements as well as a New Jersey Department of Labor phone number where they may file complaints of violations.
- Retaliation and Noncompliance
A firm or client may not retaliate against a worker for exercising their rights under the law. If a laborer is terminated or disciplined within 90 days of exercising their rights under the law, the statute establishes a burden on the employer to disprove a rebuttable presumption of retaliation. Laborers are provided with a private right of action without an administrative exhaustion requirement, which includes both individual suits and class actions. Penalties in these private suits could range from $500 to $5,000 per violation and clients may be held jointly and severally liable for any violations.
Notable Provisions Effective August 5th
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Wage Provisions
This law includes a first of its kind provision requiring that temporary laborers be paid the same average rate of pay and benefits as the permanent employees of the client who are “performing the same or substantially similar work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions.” Additional obligations include: providing greater daily wages and less frequent payments to laborers if requested; prohibiting the deduction of certain employment-related costs from wages; and paying at least four hours pay if a laborer is not used by a client but was contracted to provide services.
- Record-Keeping Requirements
The law will require staffing firms to maintain records for a minimum of six years. These records include contact information for clients; dates of transactions; employee records for laborers, including qualifications, contact information, and assignment details; copies of contracts and invoices; wage deduction information; and copies of employment notices. Copies of certain records must be produced within five (5) days of a laborer’s written request to the firm.
- Registration
Staffing firms must register with the New Jersey Division of Consumer Affairs. This registration includes an annual fee and a surety bond of at least $200,000. If a firm fails to do this, it may be fined $5,000 a day, suspended, or debarred. Additionally, a client employing temporary laborers could face penalties for contracting with an unregistered staffing firm.
- Placement Fees
Staffing firms may not restrict a laborer’s ability to take on permanent employment with a client, but they may charge a placement fee subject to a statutory maximum.
Recommendations for Employers
Both staffing firms and clients should plan for how they will abide by these new regulations. Staffing firms should review the current wages and benefits of their laborers and the same for the permanent workers of their clients. Firms should also complete the registration and surety bond process, as well as prepare the notices and wage statements for their laborers. Existing contracts, as well as employment policies and practices, should be reviewed to ensure compliance. Firms should implement training for administrative and personnel staff to ensure that they are familiar with any new responsibilities arising under this law. New Jersey’s Governor has requested funding for “robust enforcement” of this new law, so employers should be aware that the State intends to find and penalize noncompliance with this statute.[1]
[1] See Gov. Murphy's September 22, 2022, Veto Statement.
