Governor Murphy Releases Report on Employee Misclassification (NJ)

Posted by National Alliance for Fair Contracting on

Governor Murphy Releases Report on Employee Misclassification
Announces Intent to Sign Law Giving the New Jersey Department of Labor & Workforce Development Authority to Shut Down Job Sites When Violations Are Found

July 9, 2019, 12:08 pm
Insider NJ

ATLANTIC CITY – Governor Phil Murphy today released a comprehensive report from the Task Force on Employee Misclassification, vowing to intensify efforts to curtail the widespread and illegal practice of misclassifying workers as independent contractors instead of employees, which cheats some workers out of benefits and wages, hurts law-abiding business owners, and costs the state tens of millions of dollars a year in lost employment-related tax revenue.

The Governor has given the New Jersey Department of Labor and Workforce Development (NJDOL) new tools to help put an end to misclassification and noted that his administration has already acted on eight of the task force’s 16 recommendations.

Additionally, while addressing the New Jersey State Building & Construction Trades Council’s annual convention, the Governor announced his intent to sign a bill (A-108/S-2557) giving the NJDOL the power to issue stop-work orders whenever an initial work site investigation finds sufficient violations.

“Employee misclassification hurts hardworking New Jersey workers and prevents them from receiving the benefits and the pay they worked for and deserve,” said Governor Murphy. “We know that we cannot build a stronger and fairer economy without strong worker protections. Our Administration has made cracking down on misclassification a top priority, and we will continue to root out contractors who exploit and cheat workers.”

The Governor established the task force by Executive Order No. 25 in May 2018 in response to the widespread problem of employee misclassification. In an audit last year of one percent of New Jersey businesses, NJDOL found that 12,315 workers were misclassified, resulting in $462 million in underreported wages and $14 million in lost contributions to unemployment, disability, family leave and workforce programs, according to the report.

“Misclassifying workers as 1099 employees denies them benefits, robs the State Treasury of needed revenue, and makes it harder for law-abiding businesses to compete,” said Labor Commissioner Robert Asaro-Angelo. “I want to thank Governor Murphy for his leadership on this issue, which is critical to his vision for a stronger, fairer economy.”
Misclassification is especially prevalent in construction, janitorial services, home care, transportation, trucking and delivery services, and other labor-intensive, low-wage sectors.

Among the report’s recommendations are expanding interagency cooperation through coordinated enforcement, data sharing, and cooperation with neighboring states.

NJDOL already has in place a Memorandum of Understanding with the U.S. Department of Labor, enabling the two agencies to more easily share information and jointly develop misclassification cases. A similar Memorandum of Understanding among New Jersey, Pennsylvania, and Delaware was signed today. The reciprocal agreement maximizes the neighboring states’ enforcement efforts through referrals, data sharing, and joint investigations.

The task force held public forums in Newark, New Brunswick, and Atlantic City, where it heard from scores of employees, employers, subject-matter experts, and others impacted by misclassification. Their experiences and comments informed the task force’s report.

(Read More)

(See PDF of Report)

New Law Championed by Greenstein and DeAngelo Bans Worker Wage Theft (NJ)

Posted by National Alliance for Fair Contracting on

By TAPINTO HAMILTON/ROBBINSVILLE STAFF
August 7, 2019 at 4:32 PM

TRENTON, NJ — Workers will no longer need to worry about wage theft under a new law signed on Tuesday by Acting Governor Sheila Oliver to enhance enforcement of New Jersey’s wage and hour law. The measure holds employers accountable for unpaid wages, benefits, or overtime through increased damages and fines.

It also will make victims of wage theft eligible to receive both the wages owed and liquidated damages of 200 percent of wages owed.

“We must ensure that every hardworking individual in New Jersey receives the wages they worked hard to earn,” said Oliver. “I am proud to sign this legislation that will protect the rights of workers, furthering the Murphy-Oliver Administration’s commitment to build a stronger and fairer New Jersey through protecting the right to earn a fair wage.”

The law is sponsored by Hamilton and Robbinsville’s legislative representatives Senator Linda Greenstein and Assemblymembers Wayne DeAngelo. Assemblyman Dan Benson was a co-sponsor.

“The unscrupulous employers robbing the hard working people of New Jersey of their time and money need to face the consequences of their actions,” said Senator Linda Greenstein. “When wage theft is apparent, there must be effective laws in place to protect the workers of our state and to punish the employers. Wage theft is a serious crime and it is about time that our laws reflect this.”

“Above all else, this law is about workers’ rights,” said Assemblyman Wayne DeAngelo. “Employers in New Jersey should be held to a high standard to treat their employees with the decency and legality they deserve. No one should be withheld one penny of the wages they are legally entitled to.”

“In signing this legislation, the Murphy Administration sends a clear message to workers that we have their backs and will protect them from being disciplined for reporting unpaid wages. And, it sends a clear message to the vast majority of businesses that we are aggressively pursuing their dishonest competitors with penalties for wage theft that are now stronger than ever,” said Labor Commissioner Robert Asaro-Angelo.

The new law takes effect immediately.

(See Article)

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NJ Labor Department Returns $170,000 in Back Wages to Laborers and Carpenters After Investigation into Trenton Construction Project (NJ)

Posted by National Alliance for Fair Contracting on

August 9, 2019, 9:44 am

TRENTON – Ten New Jersey laborers will be paid $170,000 in back wages after investigators found Tri County Real Estate Co. did not pay workers the legally required prevailing wage on a construction project at the Trenton East/West Senior Apartments.

“Public contracting is not a right – it is a privilege,” said Labor Commissioner Robert Asaro-Angelo. “We want all employers to know that our department takes the state’s prevailing wage laws seriously, and we will continue to investigate these matters to protect our taxpayers’ investments.”

The construction project received State Economic Redevelopment and Growth Tax Credit Incentive grant funding, and was therefore subject to New Jersey’s prevailing wage laws.

The New Jersey Prevailing Wage Act (N.J.S.A. 34:11-56.25 et seq.) establishes wage levels for workers engaged in public works projects to protect workers, promote workforce development and prevent unfair competition for labor. In New Jersey, these rates vary by county and building trade.

The initial complaint was referred to the New Jersey Department of Labor and Workforce Development (NJDOL) by the state’s federal partners at the U.S. Department of Labor.

As part of the settlement agreement, the company agreed to pay back wages due to employees, and pay $30,000 in administrative fees and penalties.

For more information on New Jersey’s wage and hour laws, please visit myworkrights.nj.gov.

(See Article)

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Amendment to New Jersey’s Prevailing Wage Act Significantly Expands the Authority of the Commissioner (NJ)

Posted by National Alliance for Fair Contracting on

July 31, 2019
CSG Labor & Employment Alert

Effective July 9, 2019, employers who fail to pay prevailing wages to employees working on projects in New Jersey subject to the Prevailing Wage Act (“Act”) may be subject to the issuance of stop-work orders by the Commissioner of Labor and Workforce Development (“Commissioner”).

The recent amendment to the Act grants the Commissioner significantly greater authority to issue stop-work orders, providing that:

  • The Commissioner can immediately issue a stop-work order to an employer regardless of whether the matter was referred to the Attorney General, if an initial determination was made that the employer has violated the Act by paying employees less than the prevailing wage.
  • A general contractor has the right to immediately terminate a subcontractor who has been issued a stop-work order.
  • A stop-work order remains in effect until the Commissioner issues an order stating otherwise.
  • The Commissioner may require an employer to file periodic reports with the Department of Labor and Workforce Department (“DOL”) for up to two years as a condition for release from a stop-work order.
  • An employer that conducts business in violation of a stop-work order will be subject to penalties for up to $5,000 for each day that it conducts business in violation of the stop-work order.
  • Upon receiving a complaint or as part of a routine investigation of potential violations of any wage and hour law, the Worker’s Compensation law, or the Unemployment Compensation law, the Commissioner or his/her agent can enter a place of employment during business hours to, among other things, examine payroll and other records and interview employees.
  • The Commissioner is empowered to subpoena witnesses, books, and records, and employers can be fined no less than $1,000 for each day the employer fails to comply with the subpoena.
  • The Commissioner can issue a stop-work order if it is determined that an employer has violated any wage and hour law, the Worker’s Compensation law, or the Unemployment Compensation law.
  • An employer which has been issued a stop-work order has the right to appeal the decision within 72 hours.
  • Instead of issuing a stop-work order, after determining that an employer is in violation of the Act, the Commissioner may transfer the case to the Division of Workers’ Compensation for investigation.

(Read More)

Sweeney Urges Follow Through on Effort to Prevent Misclassification of Workers (NJ)

Posted by National Alliance for Fair Contracting on

June 11, 2019, 10:40 am
Insider NJ

Trenton – The year-long wait for action by the task force established by the governor to stop the misclassification of workers has allowed unscrupulous developers and contractors to continue to ignore the labor laws intended to protect workers’ rights.

In May of 2018, Governor Murphy signed an executive order establishing the Task Force on Employee Misclassification to investigate employee misclassification and develop recommendations to enforce compliance with the laws “ensuring adequate workplace protections and providing employment-related benefits like unemployment insurance and workers’ compensation.”

To date, the task force has failed to produce any public results.

“The construction industry has been plagued by the dishonest and illegal actions of unscrupulous developers and contractors and we are all paying the price,” said Senator Sweeney (D-Gloucester/Salem/Cumberland). “The misclassification of workers has resulted in wage theft, off-the-books payments, underfunding workers’ compensation and avoiding taxes. They are exploiting workers for their own gain.”

Employers often misclassify their employees intentionally in order to reduce labor costs, avoid paying state and federal taxes, and boost their own profits.

“Protecting workers’ rights is an important function of government and there should be follow through on the intended work of the task force,” said Senator Sweeney. “During this delay, workers are losing benefits, wages and other compensation. It should be brought to an end.”

(See Article)

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Troy Singleton offers possible compromise on tax incentives (NJ)

Posted by National Alliance for Fair Contracting on

In a statement released last week, the Burlington County Democrat put forward a framework for a potential compromise that would allow the existing incentives programs to remain in place but with several reforms designed to make them more transparent and accountable.

By David Levinsky
Posted Jun 24, 2019 at 4:22 PM

TRENTON – The dispute over New Jersey’s soon-to-expire tax incentives programs has been described as a political “death match” with billions in tax revenues and the revitalization of one of the state’s poorest cities hanging in the balance.

On one side is Gov. Phil Murphy and progressive groups who argue the current incentive programs are too rich and overused and should be scrapped and replaced with new ones that are capped and targeted toward businesses in growing sectors and startups.

Opposing them are state lawmakers and business groups who want to keep the existing incentives, which they say have proven to be critical for bringing or keeping businesses in New Jersey, particularly the city of Camden and South Jersey counties like Burlington.

So far there has been little common ground between the feuding factions or willingness to compromise.

State Sen. Troy Singleton, D-7th of Delran, wants that to change.

In a statement released last week, the Burlington County Democrat put forward a framework for a potential compromise that would allow the existing incentives programs to remain in place but with several reforms designed to make them more transparent and accountable.

“Those of us who believe that our tax code can be responsibly used to spur the economy and jobs can also fight for accountability, transparency and a results-based program,” Singleton said, listing potential reforms to the existing Grow New Jersey and the Economic Redevelopment and Growth incentives programs.

Grow New Jersey is used to lure and retain businesses and promote job creation, and the Economic Redevelopment and Growth program is designed to reward developers who build in desired locations.

(Read More)

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New Jersey Workers, Advocates Celebrate Passage of Landmark Anti-Wage Theft Legislation (NJ)

Posted by National Alliance for Fair Contracting on

New Jersey Workers, Advocates Celebrate Passage of Landmark
Anti-Wage Theft Legislation

A2903/S1790 Catapults New Jersey to One of the Strongest Wage and Hour laws in the Country in Advance of the July 1st Minimum Wage Hike

INSIDER NJ
June 27, 2019, 4:15 pm

(Trenton, NJ) June 27, 2019: Today, both houses of the New Jersey State legislature passed a landmark anti-wage theft bill (A-2903 / S-1790), sending the legislation to Governor Phil Murphy’s desk. When signed into law, New Jersey’s wage and hour protections will be among the strongest in the country, just in time for the state’s minimum wage hike this July 1st.

The legislation enhances enforcement of state wage and hour laws, ensuring that workers are paid according to the law. Under the legislation, employers that violate wage and hour laws by not paying minimum wage, overtime or failing to pay for hours worked could liable for treble damages and fines. The bill also extends the statute of limitations from two to six years, strengthens joint employer liability where firms use subcontractors, and strengthens anti-retaliation provisions to protect employees who speak out against wage and hour violations.

“For low wage workers, like myself, passing the anti-wage theft bill has been just as important as increasing the minimum wage, because it means workers will actually receive the pay we have rightfully earned. Unscrupulous employers will no longer be rewarded by our laws for not paying workers. On behalf of Make the Road New Jersey, I would like to express our gratitude to Assemblywoman Quijano and Senator Weinberg for their years of commitment to ensuring the anti-wage theft bill becomes law” said Roberto Sanchez, a member of Make the Road New Jersey, a community-based immigrant and workers rights organization based in Elizabeth and Passaic.

“After years of advocacy, we are thrilled that New Jersey will have one of the strongest anti-wage theft law in the nation to protect workers against wage theft while creating a level playing field for employers that do right by their workers,” said Reynalda Cruz, a leader of New Labor, a workers’ center in based in Newark, New Brunswick, and Lakewood.

(Read More)

New Jersey Senate Bill A4897

Posted by National Alliance for Fair Contracting on

Permits … 50 year local public contracts for certain capital improvements and extends prevailing wage requirements to certain work performed under those contracts.

Second, contracts for the provision or performance of goods and services that require: (i) a total capital expenditure of more than $300,000, including expenditures by the lessee; or (ii) a capital improvement that has a life expectancy upon completion greater than 20 years, may be for a period of up to 50 years. The chief financial officer of the local government unit, however, is required to certify that the capital expenditure or capital improvement requirement is satisfied. The prevailing wage would have to be paid for any construction project under these capital improvement contracts.

(Read More)

(Copy of Bill)

New Jersey Senate Bill 368

Posted by National Alliance for Fair Contracting on

Authorizes political subdivisions to set aside 0.5 percent of public works funds to recruit and train women and minorities and promote local hiring.

A political subdivision may elect, but is not required, to transfer to the department or retain, for any one or more of the purposes indicated in subsection b. of this section or for the purpose of providing incentives or otherwise facilitating a local hiring and employment program, an amount equal to one half of one percent (0.5%) of the portion of any public work contract of the political subdivision.

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(Copy of Bill)

OP-ED: CONSTRUCTION WORKERS MISCLASSIFIED AS CONTRACTORS – AN OUTRAGE (NJ)

Posted by National Alliance for Fair Contracting on

RICHARD E. TOLSON
MAY 7, 2019

‘Wealthy developers are taking advantage of labor laws and outdated regulation and enforcement to increase profit margins’

National civil rights and economic justice leaders gathered in New Brunswick late last week for the 2019 Summit for Civil Rights, and I was honored to join legendary leader Congressman Jim Clyburn on a panel at the event. It was privilege for New Jersey to host this event, but it was also ironic considering the injustices happening in our own backyard, and in plain sight.

It’s not often thought of as top-tier issue, but the gross, widespread and often crippling injustices imposed on working men and women in the construction industry in our state measure up as significant abuse and perpetuate structural inequality. While we purport to stand for fairness, all across our state, wealthy developers are taking advantage of labor laws and outdated regulation and enforcement to increase profit margins by abusing workers. And it has to stop.

These are millionaires utilizing middlemen to break state and federal laws by misclassifying full-time workers as contractors – denying them basic benefits and rights like healthcare, committing wage theft by paying below the required living wage, establishing illegal work weeks, paying cash and evading taxes – all to increase already record profits from rents and property sales.

A 2016 Stockton University report conservatively estimated that the developers are stealing more than $25 million in state tax revenue annually via these illegal tactics. But far worse, this theft involves approximately 35,000 workers who are off the books or illegally misclassified as independent contractors. An entire underground economy has been allowed to fester, all built on the abuse of workers, for the benefit of multimillionaires.

Not exactly a high-water mark for civil rights, huh?

(Read Me)