NJ Temporary Workers’ Bill establishes guidelines for temporary help service firms and third-party clients to ensure workers receive equal pay.
The “Temporary Workers’ Bill of Rights” [A1474/S511] was signed into law on February 6, 2023, making New Jersey the first state in the nation to provide temporary employees pay equal to permanent employees. Attempting to advance pay equity, the bill will “allow for temporary workers to be paid at least the same average rate of pay and equivalent benefits as the third-party client’s permanent employees performing the same or similar work on a job that requires equal skill, effort, and responsibility.”
If there is no work available at the third-party client’s worksite where the temporary worker is assigned, they must be paid for a minimum of four hours of pay at the agreed rate. If the temporary worker can work at another location during the same shift, they must still be paid for a minimum of two hours of pay at the agreed upon rate.
Key Elements of the Law
- A “temporary worker or laborer” is defined as a person who contracts for employment with a temporary help service firm.
- A “temporary help service firm” is defined as any person or entity who runs a business which consists of employing individuals directly or indirectly to assign the employed individuals to help the firm’s customers in handling 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.
- A “third-party client” is defined as any person who contracts with a temporary help service firm for obtaining temporary laborers in a designated classification placement.
Covered Temporary Workers:
The bill does not cover all temporary positions but those that the legislature has considered to be “at greatest risk of exploitation.” That includes temporary workers performing work in the following occupational categories designated by the Bureau of Labor Statistics (BLS):
- Other Protective Service Workers (33-9900)
- Food Preparation and Serving Related Occupations (35-0000)
- Building and Grounds Cleaning and Maintenance Occupations (37-0000)
- Personal Care and Service Occupations (39-0000)
- Construction Laborers (47-2060)
- Helpers, Construction Trades (47-30000)
- Installation, Maintenance, and Repair Occupations (49-0000)
- Production Occupations (51-0000)
- Transportation and Material Moving Occupations (53-0000)
- Or any successor categories as the BLS may designate
The Bill Carries the Following Requirements:
- On May 7, 2023, temporary service providers will need to provide temporary workers with a detailed wage notice in English and the worker’s primary language. The notice must communicate the following 11 items: (a) name of the temporary worker; (b) name, address and telephone number of the temporary service firm or agent facilitating the placement, its workers’ compensation carrier, worksite employer or third-party client, and the Department of Labor and Workforce Department; (c) name and nature of the work to be performed; (d) wage offered; (e) name and address of the assigned worksite; (f) terms of transportation offered, if applicable; (g) job description with requirements such as special clothing, clothing to be provided by the temporary agency or client, protective equipment, training, and any licenses and costs charged to the employee for supplies or training; (h) whether a meal or equipment, or both, are provided, and the cost of each; (i) the schedule of multi-day assignments; (j) if known, the length of the assignment; and (k) the amount of sick leave entitled to the temporary worker under the New Jersey’s Earned Sick Leave Laws and how to use it.
- Requires a detailed itemized statement on the temporary workers’ paycheck stub identifying five items: (a) name, address, and telephone number of each third-party client the workers worked for during the pay period; (b) number of hours workers at each third-party client; (c) rate of pay for each hour worked, including any premium rate or bonus; (d) total pay period earnings; and (e) amount of each deduction made and information as to why it was made. Placement fees must also be disclosed.
- Prohibits pay deductions for meals, equipment, criminal background check or drug testing, check cashing, as well as transportation costs to and from the worksite to reduce pay below minimum wage, currently set at $14.13 effective January 1, 2023. The minimum wage will increase to $15 on January 1, 2024.
- Recordkeeping requirements include retaining for six years the name, address, and telephone number of the third-party clients, copies of all contracts, and employment notices to temporary workers.
- The third-party clients must provide the temporary service firm the name and address of the temporary worker, specific location worked, type of work performed, number of hours worked, hourly rate of pay, and the date sent no later than seven days following the last day of the work week.
- Neither the temporary help service firms nor third-party clients can retaliate against a temporary worker by firing them or treating them unfairly in any way for exercising their legal rights. Temporary agencies are prohibited from stopping an employee from accepting another position with a permanent employer or a third-party client.
- Failure by the third-party client to maintain and remit accurate time records can lead to a civil penalty not to exceed $500 for each violation found by the Commissioner. Failure to comply with other aspects of the law can result in violations between $500 and $5,000 per violation.
- Temporary workers able to successfully prove unlawful retaliation would be entitled to the greater of all legal or equitable relief or liquidated damages equal to $20,000 per incident, reinstatement, and attorney’s fees and costs.
- Temporary workers can initiate a civil action in the Superior Court, with no exhaustion requirements, against both the temporary firm and the third-party client. Both can be held jointly liable for payments of wages.
- The statute of limitations is six years from the final date of employment.
- The Commissioner can deny, revoke, or refuse to renew any registration of a temporary help service firm.
The bill provides for oversight of temporary help service firms and third-party clients by the New Jersey Department of Labor and Workforce Development (NJDOL) and the Division of Consumer Affairs (DCA) with the Department of Law and Public Safety. The DCA will oversee the certification requirements for temporary help service firms. Third-party clients will be prohibited from contracting with uncertified firms.
According to the NAACP NJ Conference President, Richard Smith, “Black temp workers in particular face serious discrimination and rarely see the types of wage raises and access to benefits that their direct-hire counterparts enjoy.”
New Jersey leads the country by passing this law to protect temporary workers who have long been excluded from equal pay legislation and access to benefits. The bill is exhaustive with many requirements imposed on both the temporary services firm and the third-party contractor. Third-party contractors should review and possibly renew their agreements with temporary service firms to ensure compliance with this new law prior to the May 7, 2023 implementation and review the law further to identify the provisions to be implemented before August 5, 2023.
Even though the purpose of the law is to create equal pay for those temporary workers in lower paying positions, this task is a difficult one without knowing the wage rate or range of the comparable regular worker, which does not appear to be required of the third-party vendor to pass to the temporary agency. Therefore, as written, it appears to be more of a pay transparency, rather than a pay equity law.
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