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NJ Steps Up Fight Against Misclassified Workers

Posted on: July 9, 2021

New Jersey took a big step to protect the rights of workers Thursday when Gov. Phil Murphy signed into law a package of bills that target worker misclassification.

The term worker misclassification means assigning workers to a category that it is not appropriate for the work they do, which might seem like a technicality but it has a big impact on the benefits available to the worker and the tax dollars going back to the state.

According to the New Jersey Department of Labor (NJDOL), the state divides workers into two classifications: independent contractors and employees. Regular workers – or employees – have protections such as workers compensation insurance if injured at work; sick and family leave; anti-discrimination laws; overtime pay and much more. Independent contractors do not get any of those benefits.

Since employers have not had to pay tax contributions for independent contractors and only for employees, it is financially attractive to employers to classify, or misclassify, workers as independent contractors. Murphy’s signature on four bills designed to prevent this problem on Thursday should provide more protections for workers who are misclassified and discourage employers from doing so. Punitive damages will be assigned to employers who are found to misclassify workers, to provide the workers with money that would have gone to them if classified correctly.

An employee is encouraged to call Ellis Law, P.C., if they believe they have been misclassified at work for a free consultation at 732-308-0200 or contact us online. The firm is located in Freehold, New Jersey, and serves clients throughout East Brunswick, Toms River, Middletown, Jersey City, Neptune, Hudson County, Union County, Essex County, Monmouth County, Marlboro, and Ocean County, as well as Brooklyn and New York City.