November 19, 2018

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New Jersey Governor Murphy Creates Task Force on Employee Classification

On May 3, New Jersey Governor Phil Murphy signed an executive order (“Order”) establishing a Task Force on Employee Misclassification (“Task Force”) to address concerns surrounding the misclassification of employees as independent contractors. The Order estimates that misclassification may deprive New Jersey of over $500 million yearly in tax revenue and deprive workers of employment-related benefits and protections to which they are entitled.

The Task Force’s mandate is to provide advice and recommendations to the Governor’s Office and Executive Branch Departments and agencies on both strategies and actions to fight misclassification, including:

  1. Examining and evaluating existing misclassification enforcement by executive departments and agencies;
  2. Developing best practices by departments and agencies to increase coordination of information and efficient enforcement;
  3. Developing recommendations to foster compliance with the law, including by educating employers, workers, and the public about misclassification; and
  4. Conducting a review of existing law and applicable procedures related to misclassification.

The Task Force will be comprised of at least 12 members, including three representatives from the Department of Labor and Workforce Development; three representatives from the Department of the Treasury; and one representative each from the Department of Law and Public Safety, the Department of Agriculture, the Department of Banking and Insurance, the Department of Human Services, the Department of Transportation, and the Economic Development Authority.

The Order calls for the Task Force to organize and meet as soon as possible to begin its work and is a likely harbinger of increased governmental audits and enforcement actions. Accordingly, the time is ripe for employers to review their policies and practices with respect to consultants and other independent contractors to ensure they meet New Jersey’s stringent ABC Test for classification of independent contractors, which we have previously discussed.

©2018 Epstein Becker & Green, P.C. All rights reserved.

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About this Author

Paulina Grabczak, Epstein Becker Law Firm, Healthcare Attorney
Associate

Paulina Grabczak is an Associate in the Health Care and Life Sciences practice, in the Newark office of Epstein Becker Green.

Ms. Grabczak:

  • Advises on federal and state health care fraud and abuse laws, including the Stark Law and the Anti-Kickback Statute

  • Assists with all aspects of transactional regulatory health care due diligence

  • ...
973-639-8274
Maxine Neuhauser, EpsteinBeckerGreen, Life Science, Employment, Health Care
Member

MAXINE NEUHAUSER is a Member of the Firm in the Labor and Employment and Health Care and Life Sciences practices, in the Newark office of Epstein Becker Green. Her practice focuses on litigation and providing strategic advice and counsel to regional, national, and international corporations, in multiple areas of law, including labor and employment, intellectual property and non-competes, and health. Ms. Neuhauser has represented clients in numerous, diverse industries, including financial services, aviation, managed care, life sciences, and retail. She also represents social service agencies and other nonprofit organizations. 

973-639-8269