New Jersey’s legislature is one of at least five state assemblies considering changes in employee and contractor classification.
On March 14, the state assembly transportation committee reported favorably on the Truck Operator Independent Contractor Act. The bill, A1578, is opposed by the Owner-Operator Independent Driver Association. An identical bill, S1450, also was introduced in the state’s senate.
The bills stipulate the state’s labor department consider port drayage and parcel delivery drivers employees instead of contractors, unless the service receiver can overcome legal presumption of employment. Non-employee status would include requiring that service provided is outside the usual course of the business for which the service is performed or the service is performed outside of all of the payor’s business locations.
The committee amended the bill to apply this reclassification to the state workers’ compensation law. However, the provisions regarding misclassification would not be applicable to the prevailing wage law.
Civil penalties would apply and if misclassification is committed knowingly, criminal penalties as well. If the violator underpaid employees because of misclassification, then criminal fines and restitution to victims could apply. Administrative penalties may also be assessed to $2,500 for a first violation and up to $5,000 for each subsequent violation.
Conversely, Connecticut is considering an exception in the workers’ compensation status. It would apply to owner-operators of trucks weighing 10,000 pounds or more and who transport property, even in part, in interstate commerce. On March 19, HB6151 was filed the Legislative Commissioner’s Office after its introduction Jan. 25.
.Other states considering bills addressing employee misclassification: