Legal Blogs and Updates

Governor Murphy signed the “Temporary Workers’ Bill of Rights” on February 6, 2023. The legislation expands the rights and protections of temporary workers in New Jersey” while placing a wide range of obligations on staffing agencies and the employers that use them. The legislation takes effect on August 5, 2023, except for new hire notice and retaliation provisions, which take effect on May 7, 2023.

The legislation targets “temporary help service firms” who make “designated classification placements” of temporary workers with “third party clients.” Below is an overview of some of the legislation’s key terms and provisions. 

Key Terms

Temporary help service firms, more commonly known as staffing agencies, are defined as:

any person or entity who operates a business which consists of employing individuals directly or indirectly for the purpose of assigning the employed individuals to assist the firm's customers in the handling of the customers' temporary, excess or special workloads, and who, in addition to the payment of wages or salaries to the employed individuals, pays federal social security taxes and State and federal unemployment insurance; carries workers’ compensation insurance as required by State law; and sustains responsibility for the actions of the employed individuals while they render services to the firm's customers.

Designated classification placement is defined as

An assignment of a temporary laborer by a temporary help service firm to perform work in any of the following occupational categories as designated by the Bureau of Labor Statistics of the United States Department of Labor: 33-90000 Other Protective Service Workers; 35-0000 Food Preparation and Serving Related Occupations; 37-0000 Building and Grounds Cleaning and Maintenance Occupations; 39-0000 Personal Care and Service Occupations; 47-2060 Construction Laborers; 47-30000 Helpers, Construction Trades; 49-0000 Installation, Maintenance, and Repair Occupations; 51-0000 Production Occupations; 53-0000 Transportation and Material Moving Occupations; or any successor categories as the Bureau of Labor Statistics may designate.

Third party clients (referred to herein as employers) to are defined as:

any person who contracts with a temporary help service firm for obtaining temporary laborers in designated classification placement. The definition exempts he State or any office, department, division, bureau, board, commission, agency, or political subdivision thereof that utilize the services of temporary help service firms.

Key Provisions Effective May 7, 2023

▪  Notice Requirements

The legislation requires temporary help service firms—staffing agencies—to provide temporary laborers in designated classification placements (“Covered Workers”) with a notice in English and the Covered Workers’ primary language with the following information at the time of dispatch:

• The name of the Covered Worker;
• The name, address and telephone number of:
  1. The staffing agency or the contact information of the staffing agency’s agent facilitating the placement;
  2. Its workers’ compensation carrier;
  3. The worksite employer or employer; and
  4. The Department of Labor and Workforce Development;
• The name and nature of the work to be performed;
• The wages offered;
• The name and address of the assigned worksite of each temporary laborer;
• The terms of transportation offered to the temporary laborer, if applicable;
• A description of the position and whether it shall require any special clothing, protective equipment, and training, and what training and clothing will be provided by the staffing agency or the employer; and any licenses and any costs charged to the employee for supplies or training;
• Whether a meal or equipment, or both, are provided, either by the staffing agency or the employer and the cost of the meal and equipment, if any;
• For multi-day assignments, the schedule;
• The length of the assignment, if known; and
• The amount of sick leave to which temporary workers are entitled under the New Jersey Earned Sick Leave Law, and the terms of its use.

Staffing agencies are required to provide Covered Workers no less than 48 hours’ notice, where possible, of any changes in schedule, shift, or location.

▪  Retaliation

The legislation prohibits retaliation against temporary workers for exercising their rights.  Any disciplinary action taken against a Covered Worker within 90 days of their exercise of rights will raise a rebuttable presumption of retaliation. Violations carry a hefty fine which is the “greater of all legal or equitable relief” or “liquidated damages equal to $20,000.00 per incident of retaliation” and reinstatement if requested by the Covered Worker.

Key Provisions Effective August 5, 2023

▪  Recordkeeping Requirements

Staffing agencies are required to keep a variety of information on record for six years as to each Covered Worker:

• The name, address, and telephone number of the employer, including each worksite to which the staffing agency assigned the Covered Worker and the date of the transaction;
• The name and address, the specific location sent to work, the type of work performed, the number of hours worked, the hourly rate of pay, and the date sent. The employer shall be required to remit all information required under this paragraph to the staffing agency no later than seven days following the last day of the work week worked by the Covered Worker;
• The name and title of the individual or individuals at each employer’s place of business responsible for the transaction;
• Any specific qualifications or attributes of a Covered Worker requested by each employer;
• Copies of all contracts, if any, with the employer and copies of all invoices for the employer;
• Copies of all employment notices provided under this legislation;
• The amounts of any deductions to be made from each Covered Worker’s compensation by either the employer or by the staffing agency for the Covered Worker’s food, equipment, withheld income tax, withheld contributions to the state unemployment compensation trust fund and the state disability benefits trust fund withheld Social Security deductions, and every other deduction;
• Verification of the actual cost of any equipment or meal charged to a Covered Worker; and
• Any additional information required by the Commissioner of Labor and Workforce Development.

Some records must be available for review and copying by the Covered Worker or their authorized representative, at no cost, within five days of a written request.

▪  Pay Requirements

The legislation requires staffing agencies to provide Covered Workers with a detailed itemized statement on their paystub or an approved form containing various information, including without limit, the number of hours worked, the rate of pay, and any deductions made.

The “Temporary Workers’ Bill of Rights” also provides that Covered Workers must be paid at least the average rate of pay and the average cost of benefits as regular employees of the covered employer, or the cash equivalent thereof when “performing the same or substantially similar work . . . which requires equal skill, effort, and responsibility . . . under similar working conditions” as the employers’ regular workers.   

The concept of “substantially similar work” also appears in the 2018 Diane B. Allen Act, which modified the New Jersey Law Against Discrimination to expand protections for members of protected classes with respect to equal pay. Like the Allen Act, the “Temporary Workers’ Bill of Rights” does not provide a framework for evaluating the key concept of “substantially similar work.” While the limited case law under the Allen Act may prove instructive in framing the scope of substantial similarity, the “Temporary Workers’ Bill of Rights” includes an additional requirement that the work be “under similar working conditions.”  This phrase is also undefined by the legislation. 

Any staffing agency found to be in violation of these pay provisions will be subject to a civil penalty of up to $5,000 per violation with the employer staffed by the staffing agency held jointly and severally liable for any violations.

▪  Certification Requirements

All staffing agencies “which [are] located, operate[], or transact[] business” within New Jersey must be certified by the Director of the Division of Consumer Affairs (“Director”) in order to place temporary workers. To obtain certification, staffing agencies must provide proof of an employer account number issued by the Commissioner for payment of unemployment insurance contributions, proof of valid workers’ compensation insurance, and fill out a form created by the Director. Staffing agencies will be required to disclose the number of Covered Workers whom the staffing agency has placed in a regular position with an employer in the prior 12 months and the percentage those placements represent compared with the total number of Covered Workers contracted by the staffing agency during the same period. The form may also include additional requirements to be determined by the Director.

Staffing agencies must report any changes to the information required above within 30 days of the change. This includes an affirmative duty to report any lapse in workers’ compensation insurance to the Director, which will temporarily suspend the Staffing agency’s certification.

Staffing agencies will also be required to pay certain fees and obtain a surety bond prior to certification.

The legislation prohibits employers from contracting with uncertified staffing agencies. Any employer using a staffing agency must make periodic inquiries about the staffing agency’s certification status before contracting, as well as on March 1^st and September 1^st of each year. Contracting with an uncertified staffing agency carries a civil penalty not to exceed $500. Each day of the contract between the employer and uncertified staffing agency is a separate and distinct violation.

The legislation requires the Division of Consumer Affairs to list certified staffing agencies on its website.  Employers may also request a list of certified entities from the Director and will be held harmless if they rely on inaccurate information about certification status provided by the Director or the Division of Consumer Affairs. 

▪  Non-Competes

In addition, the legislation prohibits staffing agencies from restricting Covered Workers from accepting and employers from offering regular positions with the employer. However, the legislation permits staffing agencies to charge a placement fee to the employer who does so.

▪  Transportation

The legislation also prohibits staffing agencies from requiring Covered Workers to use transportation provided by the staffing agency and sets forth restrictions and record keeping requirements where Covered Workers elect to utilize staffing agency-provided transportation.

▪  Private Rights of Action

Covered Workers, staffing agencies, and employers who use staffing agencies have six years to bring a lawsuit for any violation of the law.

With some provisions becoming effective as early as May 7, 2023, staffing agencies and employers should use this time to set themselves up for success and review whether their current contracts and policies comply with the new requirements. 

For questions about your obligations under the new law and help complying with its requirements, reach out to a Connell Foley Labor & Employment team member.