In a December 11, 2021 press release, New Jersey Attorney General Matthew Plotkin and New Jersey Department of Labor Commissioner Robert Asaro-Angelo announced the filing of the first lawsuit under a 2021 law that enhances the State’s authority to curtail illegal misclassification of workers as independent contractors through actions such as direct suits in the Superior Court, work-stoppage orders and enhanced penalties.
“When employers unlawfully and callously toss their workers into the ‘independent contractor’ category they are not only depriving them of a steady paycheck, they are also stripping them of earned sick leave, workers compensation, minimum wage, and more,” said AG Plotkin. “These are national, profitable corporations with deep pockets who are padding their profits with illegal labor schemes, and they seem to have no plans to stop this kind of behavior.” Labor Commissioner Asaro-Angelo cautioned that companies profiting through misclassification “have been put on notice. We are proud to have the strongest worker protection laws in the country, which also safeguard employers who play by the rules. Misclassifying employees will not be profitable, nor overlooked.”
Under New Jersey law, workers are presumed to be employees unless the employer can establish the three criteria of what is commonly called the “ACBC test”: 1) the worker is largely free from the control or direction of the company over the performance of the work; 2) the type of work being performed by the worker is outside the company’s usual course of business, or is performed outside the company’s place of business; and 3) the worker has their own independent trade, job, profession or business. Treating workers who do not meet these stringent criteria deprives them of the rights and benefits afforded to employees, including minimum wage, overtime, workers compensation benefits, temporary disability benefits, earned sick leave, job protected family leave, equal pay, unemployment payments, and statutory protection against unlawful discrimination.