Crucial changes in latest NJ independent contractor rule impacting truckers

Changes in the New Jersey independent contractor rule, revealed last week, are taking some of the edge off earlier hostility to the proposal when it was first introduced. But what remains is still being viewed by those who hire independent contractors as an ABC test that will be one of the most stringent in the country.

The rule was released by the New Jersey Department of Labor (NJDOL) in order to codify regulatory precedents that have built up over the years and put into the regulatory framework. The new IC rule will be used by agencies interpreting such laws as New Jersey’s Wage & Hour law and its Wage Payment law, according to the NJDOL in its announcement of the rule.

window. googletag = window. googletag || {cmd: []}; googletag. cmd. push(function() {googletag. defineSlot('/21776187881/FW-Responsive-Main_Content-Slot1', [[300, 100], [320, 50], [728, 90], [468, 60]], 'div-gpt-ad-1709668545404-0'). defineSizeMapping(gptSizeMaps. banner1). addService(googletag. pubads()); googletag. pubads().

enableSingleRequest(); googletag. pubads(). collapseEmptyDivs(); googletag. enableServices(); }); googletag. cmd. push(function() {googletag. display('div-gpt-ad-1709668545404-0'); }); New Jersey’s ABC rule on its surface is similar to ABC tests in other states.

It is not a law, unlike California’s AB5, but rather a product drawn from earlier regulatory and court rulings.

It says for a worker to be independent, that person must meet all three of these criteria: A) Worker has been and will continue to be free from control or direction over the performance of services, both under the worker’s contract of service and in fact; B) Work performed is either outside the usual course of the business for which the work is being performed, or the work is performed outside of all the places of business of the enterprise; and C) Worker is customarily engaged in an independently established trade, occupation, profession or business.

The details in further defining those three was at the heart of the recent process. Legal commentary that surrounded the recently-announced changes mostly were in agreement on what were the most significant shifts from the initial proposal, with one of the biggest seemingly being the most simple.

Complying with the law no longer a trigger In what was seen as the most radical change in the original proposal, New Jersey’s A prong would have established that a worker was more likely to be found to be an employee rather than an IC if the employer required compliance with laws or regulations.

As the initial proposal put it, “There is nothing in New Jersey statute…to indicate that control or direction exercised by a putative employer to ensure compliance with a law or rule should be excluded from consideration when evaluating the facts of a potential employment relationship under Prong A of the ABC test.” window. googletag = window.

googletag || {cmd: []}; googletag. cmd. push(function() {googletag. defineSlot('/21776187881/fw-responsive-main_content-slot3', [[728, 90], [468, 60], [320, 50], [300, 100]], 'div-gpt-ad-1665767553440-0'). defineSizeMapping(gptSizeMaps. banner1). addService(googletag. pubads()); googletag. pubads(). enableSingleRequest(); googletag. pubads().

collapseEmptyDivs(); googletag. enableServices(); }); googletag. cmd. push(function() {googletag. display('div-gpt-ad-1665767553440-0'); }); In other words, requiring a worker to follow the law could be interpreted as “control” of the employee, which is core to Prong A. That regulation regarding compliance with the law is now out of the revised proposal.

The new language reads: “Actions taken by a putative employer solely to comply with federal, state, or local, laws or regulations shall not, standing alone, be considered evidence of control or direction under Prong A.” Greg Feary, a partner at the trucking-focused law firm of Scopelitis, described the impact of that change on trucking as “big.”

“The rules, regulations and laws are big in any industry that’s heavily regulated,” Feary said in an interview with FreightWaves. “Safety in trucking is heavily regulated, as well as federal leasing regulations.” Having a trucking company require its ICs to follow those laws is standard practice, Feary noted.

And under the New Jersey law, a company requiring adherence to the law could be viewed as establishing an employee relationship, rather than a truly independent status. It would have been a big problem window. googletag = window. googletag || {cmd: []}; googletag. cmd. push(function() {googletag.

defineSlot('/21776187881/fw-responsive-main_content-slot4', [[300, 100], [320, 50], [728, 90], [468, 60]], 'div-gpt-ad-1709668086344-0'). defineSizeMapping(gptSizeMaps. banner1). addService(googletag. pubads()); googletag. pubads(). enableSingleRequest(); googletag. pubads(). collapseEmptyDivs(); googletag. enableServices(); }); googletag. cmd.

push(function() {googletag. display('div-gpt-ad-1709668086344-0'); }); In its submitted comments to the state on the rule, attorney Richard Reibstein of t