New Jersey is addressing a troubling workplace trend that has emerged in recent years in which employees doing full-time work are misclassified by employers who aim to avoid costly obligations, such as overtime pay requirements and benefits. The unfair practice of assigning a steady full-time worker as an independent contractor cheats the worker out of a host of employment rights to which they are entitled.
The employee-status advantages these workers miss out on include overtime pay, family and sick leave allowances, as well as unemployment insurance protection and Workers’ Compensation benefits. A contractor, as opposed to many full-time employees, would also have to pay for their own health insurance and Social Security contributions.
Workers are not the only ones that lose out to these unfair employers. It is also unfair to competing businesses that have not taken advantage of the now-illegal employee-classification loophole. In fact, anyone who benefits from state-funded initiatives is also being cheated, as income tax revenues are reduced. The tax-paying general public may be unknowingly picking up the slack, as workers without employee health insurance or Workers’ Compensation benefits lean on Medicare to support their medical needs.
Governor Phil Murphy recently announced to a convention of union workers the conclusions found by a team he had assembled in May to identify these too-common employment abuses and make recommendations on ways to address them. The Task Force on Employee Misclassification came up with several fixes, some that require legislative action and others that are already in the works. For those recommendations that cannot go into effect right away, the administration intends to work with state legislators to change existing laws or create new laws to stop the exploitations by crafty employers.
Among the resolutions recommended by the task force are several cooperation initiatives with surrounding states and federal authorities to keep track of offending employers. One initiative at the federal level calls for Division of Consumer Affairs investigators to be trained to recognize violations. One in New Jersey notifies accountants throughout the state about how to advise their business clients against such misconduct. More money and manpower has been put behind enforcement, public and worker education, and programs to encourage reporting abuses and to bring awareness and compliance to businesses.
On the same day as the announcement, Governor Murphy signed into law a measure to empower the Department of Labor and Workforce Development Authority to crack down on employers that break state wage laws. In accordance with the new law, the department has the authority to shut down non-compliant job sites and to slap offending employers with a fine of $5000 per day.
If you have an employment issue, you may be eligible to seek damages. Contact the Long Branch employment lawyers at Fox & Melofchik, L.L.C. today. We represent employees in the fight against unfair employment practices. Call us at 732-493-9400 or fill out an online contact form to set up a free consultation.
Located in Eatontown, New Jersey, we represent clients throughout Monmouth County, Ocean County, Middlesex County, Mercer County, Asbury Park, Neptune, Long Branch, Keansburg, Ocean Township, Eatontown, Red Bank, Middletown, Colts Neck, Deal, Freehold, Holmdel, Jackson, Little Silver, Marlboro, and Rumson.