Since early 2020, New Jersey has passed a series of legislation aimed at identifying and penalizing businesses for misclassification of employees as independent contractors. On July 8, 2021, New Jersey enacted A5890, which empowers the Commissioner of the Department of Labor and Workforce Development (\u201cDOL\u201d) to issue broad stop-work orders to employers in violation of wage and hour laws that extend across \u201call of the employer\u2019s worksites and places of business.\u201d As set forth more fully below, we are beginning to see the DOL invoking this extraordinary power to effectively shut down an employer\u2019s business in its entirety.<\/p>\n
A5890 Stop-Work Orders and Injunctions<\/strong><\/p>\n Prior to the passage of this bill, the Commissioner\u2019s shut-down orders could only extend to the specific location where the wage and hour violation occurred. Under A5890, however, the Commissioner may now issue stop-work orders that extend across \u201call of the employer\u2019s worksites and places of business.\u201d Moreover, these stop-work orders can remain in effect until the Commissioner determines that the employer is compliant and has paid any penalties due. Employers must pay workers affected by a stop-work order for the first ten days of work lost due to the order, and the DOL can impose up to $5,000 in civil penalties for each day the employer continues to operate the business in violation of the stop-work order.<\/p>\n