Misclassification Lawsuit Filed by NJ Attorney General

Attorney General Matthew J. Platkin and New Jersey Department of Labor and Workforce Development (NJDOL) Commissioner Robert Asaro-Angelo announced today that they have filed the first lawsuit under a 2021 law that permits the State to file suit in New Jersey Superior Court against employers who have misclassified workers as independent contractors when they are, in fact, employees.

NJ Enforces Laws Against Worker Exploitation

In the four years since Governor Murphy expanded the New Jersey Department of Labor and Workforce Development's (NJDOL) powers in 2019 to halt work on job sites when there is strong evidence of worker exploitation, over 110 stop-work orders have been issued and more than $2.7 million in back wages owed to affected workers, liquidated damages, and penalties have been assessed. 

NJ Targets Rampant Misclassification of Drywall Workers

In its second strategic enforcement initiative, focusing on the drywall industry, the New Jersey Department of Labor and Workforce Development (NJDOL) reached a first-of-its-kind enhanced compliance agreement with Donald Drywall, L.L.C. of Lakewood after investigators found the subcontractor had committed numerous wage and hour, earned sick leave, and employee misclassification violations.

Employers Fined $1.3 Million for MIsclassification of Workers Including Failure to Have Adequate Workers' Compensation Insurance

The State of New Jersey is strictly enforcing laws that mandate a worker's employment status be properly reported and that employers provide adequate workers' compensation insurance coverage. The state has some of the strictest laws in the country and they are being enforced vigorously through a multi-agency protocol.

Uber Pays $100M Fine in NJ Driver Misclassification Case

Uber Technologies Inc. and a subsidiary have submitted a $100 million payment to the New Jersey Department of Labor and Workforce Development’s (NJDOL’s) Unemployment Trust Fund after an audit found the ride-share companies improperly classified hundreds of thousands of drivers as independent contractors, depriving them of crucial safety-net benefits such as unemployment, temporary disability, and family leave insurance, and failed to make required contributions toward unemployment, temporary disability, and workforce development.

NJDOL Uses Expanded Powers to Stop Worker Exploitation at Job Sites

In the three years since Governor Murphy signed a law expanding NJDOL’s powers to stop work on a job site when there is strong evidence workers are being exploited, the department has issued 71 stop-work orders, through which agents found nearly $1 million in back wages owed to 235 workers. 

Misclassification: 16 Workers Held to be Employees

 An employer need not control every facet of a person's responsibilities for that person to be deemed an employee.

NJDOL, Treasury Raid Worksite in First Joint-Enforcement Action to Combat Worker Misclassification

A team of more than 60 investigators from the New Jersey Department of Labor and Workforce Development (NJDOL) and the Department of the Treasury, supported by other state agencies, conducted an unannounced investigation of a construction site at 88 Regent Street in Jersey City in response to allegations of worker misclassification. 

NJ Enacts Legislation to Protect New Jersey Workers, Employers From Unlawful Misclassification

Building on his commitment to making sure that workers and employers in New Jersey are treated fairly, Governor Phil Murphy today signed a four-bill legislative package furthering state efforts to stop employee misclassification. 

NJ Successfully Targets Employee Misclassification

In response to a report issued by Governor Murphy’s Task Force on Employee Misclassification, the New Jersey Department of the Treasury has made significant strides to deter misclassification by organizations that do business with the State in order to help address the underlying causes that lead to ever-widening income inequality.

Stop-Work Order Issued to NJ Contractor for Misclassification Violations

The New Jersey Department of Labor and Workforce Development (NJDOL) issued a stop-work order to Galo Contractors Group, LLC, on March 9 for six alleged violations at a worksite in Keansburg.

NJ Governor Murphy Signs Sweeping Legislative Package to Combat Worker Misclassification and Exploitation

Acting on his commitment to support and uplift New Jersey workers, Governor Phil Murphy today signed a legislative package combatting worker misclassification and exploitation. The bills will crack down on employee misclassification in businesses by allowing stop-work orders against employers violating state wage, benefit, and tax law; providing assessment of penalties for violations in connection with misclassification of employees; and requiring employers to post a notice for their employees regarding employee misclassification, among others.

NJ Governor’s Report on Misclassification

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.

Trump's Gig Economy

Today's guest author is Jon Rehm, Esq. of the Nebraska bar.

The United States Department of Labor (DOL) published an opinion letter that would seem to exempt most so-called “gig economy” companies from federal wage and hour enforcement.

NJ Labor Department, USDOL Ink Agreement to Work Together to Protect Businesses and End Exploitation of Workers through Misclassification

The New Jersey Department of Labor and Workforce Development and the U.S Department of Labor pledged a historic new level of cooperation to protect New Jersey’s economy by signing an agreement on August 10, 2018 to work together to end illegal employee misclassification.

Misclassification: US Dept of Labor Issues Interpretation of Employment Status

The Application of the Fair Labor Standards Act’s “Suffer or Permit” Standard in the Identification of Employees Who Are Misclassified as Independent Contractors.

Sounding very much like a workers' compensation standardized employment status test, the US Department of Labor has added its interpretation this developing area of the law. This memo will has obvious added consequences to state interpretation to this issue. 

Workers Are Injured by Misclassification

When employers misclassify workers they attempt to cheat injured workers of adequate workers compensation benefits. In most jurisdictions workers comp rates are determined by the wages paid to the injured worker at the time of their injury.

Disability rates for workers' compensation benefits are based upon the computation of the wages of the injured employee. Statutorily, the wages are defined to mean "the money rate" at which the service rendered is paid. That rate is determined by the wages in effect according to the contract of hiring in force at the time of the accident or exposure of the employee. Board and lodging, when provided by the employer are usually considered as wages, unless the parties have entered into a contract at the time of hiring to set an alternative value. In those instances where wages are determined by the output of the employee, the daily wages are calculated by dividing the number of days the injured employee was actually employed into the total amount that the worker earned during the preceding period.

 The US Department of Labor (DOL) strictly monitors misclassification of workers and takes enforcement action when appropriate. The U.S. Department of Labor has recovered $104,837 in overtime back wages for 57 workers who had been misclassified as independent contractors and thereby denied overtime compensation for all hours of their work in violation of the Fair Labor Standards Act, following an investigation by the department’s Wage and Hour Division. The workers were employed by Cecil Parker Jr., the owner of a debris cleanup company in Anahuac.

The DOL reports of the serious consequences of misclassification, "The misclassification of employees as independent contractors is an alarming trend, particularly in industries such as construction that often employ low-wage, vulnerable workers, and in which the division historically has found significant wage violations. The practice is a serious threat both to employees entitled to good and safe jobs, as well as to employers who obey the law. Too often misclassified employees are deprived of overtime and minimum wages, and forced to pay taxes that their employers are legally obligated to pay. Honest employers have a difficult time competing against scofflaws. The Labor Department is committed to ensuring that employees receive the pay and benefits to which they are legally entitled and to level the playing field for employers that play by the rules."

The States need to provide better enforcement of how workers are classified and paid by employers. Injured workers continue to be "short changed" in many ways by misclassification.

Related articles

• Inconsistent Enforcement of State Wage and Hour Laws Could Lead to "Regulatory Race to The Bottom, " New Study Finds (workers-compensation.blogspot.com)
• Minimum Wage, Overtime Laws Due For Reform: Republicans (huffingtonpost.com)
• Workers Compensation, Pensions and Bankruptcy (workers-compensation.blogspot.com)
• Penalties, Paper and The Injured Worker (workers-compensation.blogspot.com)