Notably, despite prior versions to the contrary, the enacted bill does not apply to all temporary positions, but only those the Legislature has determined “are particularly vulnerable to abuse of their labor rights.”

Last month, New Jersey Governor Phil Murphy signed into law Assembly Bill No. A 1474/S 511, known as the Temporary Laborers' Bill of Rights, establishing numerous protections for the state’s 127,000 temporary workers. The implications of the law are significant, as it places onerous burdens on employers and temporary help service firms in the state. The law is one of the country’s first to require, among other things, that temporary workers be paid the same as permanent employees of a third-party client.

Who Does It Cover?

The law applies to “temporary laborers,” defined as people who contract “for employment in a designated classification placement with a temporary help service firm.” “Temporary help service firm” is defined as:

[A]ny 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 work loads, 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.

Notably, despite prior versions to the contrary, the enacted bill does not apply to all temporary positions, but only those the Legislature has determined “are particularly vulnerable to abuse of their labor rights.” Included are the following occupational categories:

1. Protective service workers;
2. Food preparation- and serving-related occupations;
3. Building and grounds cleaning and maintenance occupations;
4. Personal care and service occupations;
5. Construction laborers;
6. Helpers in construction trades;
7. Installation, maintenance and repair occupations;
8. Production occupations; and
9. Transportation and material moving occupations.

What Is Required?

Wage and Benefit Requirements―Effective August 5, 2023

The most noteworthy and controversial provision of the bill requires that temporary laborers be paid the same average rate of pay and benefits as a permanent employee of a third-party employer, “performing the same or substantially similar work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions.”

If a temporary laborer reports to an employer’s worksite, but there is no work, that worker must still be paid a minimum of four hours, unless the laborer was sent to another location, in which case the laborer must be paid a minimum of two hours.

At the request of a temporary laborer, temporary help service firms must hold daily wages and make biweekly pay checks to avoid check-cashing fees.

The bill prohibits certain wage deductions, including transportation, background checks and for cashing paychecks. Costs of meals and equipment can still be deducted so long as a laborer’s hourly rate does not fall below the minimum wage.

Registration―Effective August 5, 2023

Each temporary help service firm must register to operate in the state, pay an annual fee and obtain a surety bond of no less than $200,000.

Recordkeeping Requirements―Effective August 5, 2023

Under the bill, temporary help service firms will be required to keep certain records for six years including, among other things, contact information of the third-party employers and temporary laborers, specific qualifications or attributes of a temporary laborers, copies of all contracts and employment notices, the amounts of any deductions and verification of the actual cost of any equipment or meals charged. Firms will also be required to make these records, as well as the number of hours billed to a client, available to a temporary laborer within five days following a written request.

Notice Requirements―Effective May 7, 2023

Temporary help service firms must begin providing temporary laborers with a written statement in English and in the worker’s primary language on a form approved by the commissioner of the Department of Labor and Workforce Development that includes the following:

1. The name of the temporary laborer;
2. The name, address and telephone number of:
   1. The temporary help service firm or the contact information of the firm's agent facilitating the placement;
   2. Its workers' compensation carrier;
   3. The worksite employer or third-party client; and
   4. The Department of Labor and Workforce Development;
3. The name and nature of the work to be performed;
4. The wages offered;
5. The name and address of the assigned worksite of each temporary laborer;
6. The terms of transportation offered to the temporary laborer, if applicable;
7. 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 temporary help service firm or the third-party client, as well as any licenses and any costs charged to the employee for supplies or training;
8. Whether a meal or equipment, or both, are provided, either by the temporary help service firm or the third-party client, and the cost of the meal and equipment, if any;
9. For multiday assignments, the schedule;
10. The length of the assignment, if known; and
11. The amount of sick leave to which temporary workers are entitled under New Jersey Earned Sick Leave laws and the terms of its use.

Firms are also required to provide each temporary laborer with a detailed itemized statement on their paycheck stub (or on a form approved by the commissioner of Labor and Workforce Development) listing the following:

1. The name, address and telephone number of each third-party client at which the temporary laborer worked;
2. The number of hours worked by the temporary laborer at each third-party client each day during the pay period;
3. The rate of payment for each hour worked;
4. The total pay period earnings;
5. The amount of each deduction; and
6. The current maximum placement fee that the temporary help service firm may charge to a client to directly hire the worker, and the total amount of actual charges to the client for the worker during each pay period compared to the total compensation cost for the worker, including costs of any benefits provided.

For each temporary laborer who is contracted to work a single day, the third-party client must, at the end of the workday, provide the temporary laborer with a work verification form, approved by the commissioner, which contains the date, the temporary laborer's name, the work location and the hours worked on that day.

Placement Fees―Effective August 5, 2023

The new law prohibits any restrictions on a temporary laborer’s ability to accept or be offered a permanent position with the third-party client. However, temporary help service firms may charge a placement fee:

[N]ot to exceed the equivalent of the total daily commission rate the temporary help service firm would have received over a 60-day period, reduced by the equivalent of the daily commission rate the temporary help service firm would have received for each day the temporary laborer has performed work for the temporary help service firm in the preceding 12 months.

What Are the Consequences for Noncompliance?

The Temporary Laborers’ Bill of Rights makes it unlawful to retaliate against a worker for exercising their rights under the law. This includes complaints to the temporary help service firm or the client employer, as well as instituting or participating in any proceeding related to the new law. Terminating or disciplining a temporary laborer within 90 days of a laborer exercising their rights under the law will raise a rebuttable presumption of retaliation.

The law also provides for a private right of action, expressly provides that actions can be brought as class actions, and carries significant penalties for violations, ranging from $500 to $5,000 per violation.

Significantly, the Temporary Laborers’ Bill of Rights will make employers that contract with temporary help service firms jointly and severally liable for any violations.

What This Means for New Jersey Employers

The highly controversial Temporary Laborers’ Bill of Rights places numerous significant obligations on temporary help service firms and their third-party clients. Given that violations of the law will be costly, temporary help service firms and employers would be wise to begin planning for the bill’s requirements now.

For More Information

If you have any questions about this Alert, please contact Michael R. Futterman, Patrice E. LeTourneau, Danielle M. Dwyer, any of the attorneys in our Employment, Labor, Benefits and Immigration Practice Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.