Employers typically have a wide range of legal responsibilities with respect to their workers, from offering health care or unemployment insurance to providing adequate protections from workplace discrimination or dangerous working conditions. The extent of an employer’s legal responsibility frequently depends on whether the worker is classified as an employee or an independent contractor. Employee misclassification is illegal in New Jersey and the problem is growing.
Independent Contractors
Illegally misclassifying an employee as an independent contractor can benefit an employer in many cases. Employers often have reduced labor costs or owe less in state and federal taxes with respect to workers classified as independent contractors. While employers must provide employees with certain employment-related benefits, such as paid sick leave, unemployment insurance, or Workers’ Compensation, they often do not have the same legal duty to independent contractors working for the company.
Workers classified as independent contractors may be denied access to other employee perks, including access to employee assistance programs, such as New Jersey’s Family Leave Insurance. Employee misclassification may be considered a type of employer wage theft that denies workers the wages and benefits to which they are entitled.
Workers’ Rights
Federal and state governments play an important part in protecting workers’ rights. Recognizing employee misclassification is a type of worker exploitation. New Jersey Governor, Phil Murphy, recently signed Executive Order 25, authorizing the creation of a Task Force on Employee Misclassification. Governor Murphy categorized the Task Force as a “step forward to end a practice that creates an unfair advantage over companies that play by the rules and hurts our working families.”
New Jersey employers who intentionally misclassify their workers as independent contractors are now the target of this Task Force. Responsibilities of the Task Force include examining and evaluating existing misclassification enforcement in state agencies and executive departments, creating best practices in New Jersey for efficient enforcement of state laws related to employee misclassification, increasing coordination of information between state departments and agencies, making recommendations to increase compliance with the law, educating the public, including employers and workers, about the problem of employee misclassification, and reviewing existing laws and procedures applicable to the problem.
Benefits of the New Task Force
New Jersey officials are hopeful the new Task Force will help end the unfair labor practice of employee misclassification, reduce employer wage theft, and promote fairness throughout the state. Advocates for the creation of the Task Force believe it may level out unfair advantages in public project bidding for contractors who previously have circumvented state labor laws.
The Task Force will have at least 12 members and include three representatives from the Department of Labor and Workface Development and the Department of Treasury. One representative each from the Department of Law and Public Safety, the Department of Agriculture, the Department of Banking and Insurance, the Department of Transportation, the Department of Human Services, and the Economic Development Authority will also be a member of the Task Force.
Marlton Employment Lawyers at McOmber McOmber & Luber, P.C. Handle All Types of Employment Related Matters
If you have an employment-related matter you need to dispute, including those related to employee misclassification, the Marlton employment lawyers at McOmber McOmber & Luber, P.C. can help. Our offices are conveniently located in Red Bank and Marlton, New Jersey to assist employees and employers throughout the state. Call our Red Bank office at 732-842-6500, our Marlton office at 856-985-9800, our Newark office at 973-878-9040, or contact us at 888-396-0736 or online for a free consultation. We represent clients throughout New Jersey.