Independent contractors are a very important type of worker these days, as a kind of employment classification that is rising in popularity, as an employment lawyer Atlanta, GA trusts can attest. However, it seems sometimes employers take advantage of this classification for their own benefit. Recently, there have been some important developments in New Jersey regarding the classification process, and how employees and employers need to respond.
On May 3, the governor of New Jersey – Phil Murphy – set up the Task Force on Employee Misclassification. The task force’s goal is to – according to the governor – “crack down on” contractors that “engage in 1099 fraud.” The task force is part of a larger set of measures that are designed to protect employees. There are twelve members on the task force from different administrative agencies in New Jersey. The measure’s purpose is to help workers in New Jersey by preventing companies from being able to misclassify them and get away with it.
What is employee misclassification?
Employee misclassification happens when people who are actually “employees” – not “independent contractors” – do not get the valuable benefits they should be getting as workers with employee status. Independent contractors, on the other hand, do not get such benefits. These benefits include: family and medical leave; unemployment insurance; and overtime compensation. Hence, by creating this task force, the governor is saying that he is going to make sure that employers are properly classifying employees, thereby providing these employees with more protections and advocacy.
What is the task force going to do to fight misclassification?
The Executive Order that the governor used to create the task force mandates that the group is to: (1) evaluate misclassification enforcement; (2) develop best practices for generating information around misclassification and efficiently enforcing the law; (3) produce recommendations for compliance; and (4) review the laws that exists.
What are the implications?
Both employees and employers ought to know about this changing landscape in New Jersey. The governor is signaling that he means business when it comes to enforcing the law and developing best practices around misclassification. So, employers should make sure their classification processes are legitimate under New Jersey rules, and employees should make sure that they are receiving all of the benefits they deserve under the law. The governor wants to make sure everyone is on notice of the changes, that the laws around this issue will be enforced, and might make an example out of a non-compliant company.
Thanks to our friends and contributors from Barrett & Farahany, LLP for their insight into job applicant information.