New Jersey Governor Murphy signed the Temporary Workers’ Bill of Rights Act (A1474/S511) into law on February 6, 2023 granting protections to the approximately 127,000 temporary workers employed by temporary staffing agencies.
In enacting the Temporary Workers’ Bill of Rights, the New Jersey Legislature cited a heavy concentration of Blacks and Latinos in temporary positions, often earning 41 percent less than traditional workers, and less likely than other workers to receive employer-sponsored retirement and health benefits. The Legislature also highlighted that low-wage temporary laborers are also particularly vulnerable to an abuse of their labor rights “including unpaid wages, failure to pay for all hours worked, minimum wage and overtime violations, unsafe working conditions, unlawful deductions from pay for meals, transportation, equipment, and other items, as well as discriminatory practices.”
The law covers key areas, including:
-
Equal pay protections;
-
Wage payment and overtime protections;
-
Retaliation prohibitions; and
-
Notification and recordkeeping requirements.
The law provides for both penalties and a private right of action to enforce such rights. The notification and anti-retaliation provisions take effect May 7, 2023, while the balance of the law’s provisions go into effect on August 5, 2023.
Who is Covered?
The law applies to non-exempt workers assigned by a temporary staffing agency (the Legislative Findings state that temporary help service firms are sometimes referred to as temp agencies or staffing agencies) to work in occupational categories such as Protective Service Workers; Food Preparation and Serving Related Occupations; Building and Grounds Cleaning and Maintenance Occupations; Personal Care and Service Occupations; Construction Laborers; Helpers, Construction Trades; Installation, Maintenance, and Repair Occupations; Production Occupations; Transportation and Material Moving Occupations.
The law applies to “temporary laborers” defined as those who contract for employment in a designated classification placement with a temporary help service firm. It does not include agricultural workers, professional employees, or who are secretaries or administrative assistants.
A “temporary help service firm” means any 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.
A “third party client” means any person who contracts with a temporary help service firm for obtaining temporary laborers. It does not include the State or any office, department, division, bureau, board, commission, agency, or political subdivision thereof that utilize the services of temporary help service firms (in the limited categories listed above). Keep in mind that this law only applies to the temporary laborers employed by temporary help service firms and the third party clients who utilize them in the limited occupational categories listed above.
Equal Pay
The law contains an equal pay provision. A temporary laborer who is assigned to work at a third party client must not be paid less than the average rate of pay and average cost of benefits (or the cash equivalent thereof) of the third party client’s employees who are performing the same or substantially similar work on jobs which require equal skill, effort, and responsibility, and which are performed under similar working conditions. Each violation of this provision for each affected temporary laborer will constitute a separate violation under the law.
Any temporary help service firm in violation of this provision may be subject to a civil penalty not to exceed $5,000 for each violation found by the Commissioner.
Anti-Retaliation
A temporary help service firm or third-party client, or any agent thereof, may not retaliate against a temporary laborer for exercising any rights under the law, including:
-
Making a complaint to a temporary help service firm, to a third party client, to a co-worker, to a community organization, before a public hearing, or to a State or federal agency that the temporary worker’s rights under the law have been violated; or
-
Testifying or preparing to testify in an investigation or proceeding under the law.
If a temporary help service firm or third party client violates this provision, the Commissioner of Labor and Workforce Development (“Commissioner”) is authorized to assess and collect administrative penalties, up to a maximum of $250 for a first violation and up to a maximum of $500 for each subsequent violation. When determining the amount of the penalty imposed, the Commissioner shall consider the following factors: the history of the employer’s previous violations, the seriousness of the violation, the employer’s good faith, and the size of the employer’s business.
Wages and Overtime
At the time wages are paid, a temporary help service firm must provide each temporary laborer with a detailed itemized statement, on the temporary laborer’s paycheck stub or on a Commissioner-approved form, listing the following:
-
The name, address, and telephone number of each third party client at which the temporary laborer worked;
-
The number of hours worked by the temporary laborer at each third party client each day during the pay period;
-
The rate of payment for each hour worked, including any premium rate or bonus;
-
The total pay period earning;
-
The amount of each deduction made from the temporary laborer’s compensation and the purpose for which each deduction was made (i.e., temporary laborer’s food, equipment, withheld income tax, withheld Social Security deductions); and
-
Any additional information required by the Commissioner.
Overtime pay must be paid in accordance with the New Jersey minimum wage law.
For each temporary laborer contracted to work a single day, the third party client shall, at the end of the work day, provide such temporary laborer with a work verification form, approved by the Commissioner, which shall contain the date, the temporary laborer’s name, the work location, and the hours worked on that day.
The wages of a temporary laborer must not be withheld or diverted for any reason except those designated in this law. Upon request, workers may be paid via check or direct deposit on a bi-weekly basis.
If a temporary laborer is contracted by a temporary help service firm to work at a third party client’s worksite but is not utilized by the third party client, the temporary help service firm must pay the worker for a minimum of four hours at the agreed-upon rate of pay. However, in the event that the temporary help service firm contracts the temporary laborer to work at another location during the same shift, the temporary help service firm must pay the temporary laborer for a minimum of two hours at the agreed-upon rate of pay.
Any temporary help service firm in violation of this provision may be subject to a civil penalty not to exceed $500 for each violation found by the Commissioner. Any third party client who violates this section shall be subject to a civil penalty not to exceed $500 for each violation found by the Commissioner. The maximum civil penalty shall increase to $2,500 for a second or subsequent violation.
Notification
Under the law, temporary help service firm must provide written notice to temporary workers of the following information at the time of each new assignment:
-
The name, address, and telephone number of the staffing agency, its workers’ compensation carrier, the worksite employer or third party client, and the state Department of Labor and Workforce Development;
-
The name and nature of the work to be performed;
-
The wages offered;
-
The assigned worksite’s name and address;
-
The terms of transportation offered;
-
A description of the position, whether it will require special clothing, protective equipment, and training, and who will pay for any of those requirements;
-
Whether a meal or equipment, or both, are provided, and who will pay for them;
-
The assignment’s length; and
-
Entitlement to Earned Sick Leave (which pertains to temporary help service firms under the NJ Earned Sick Leave Law).
Additionally, the temporary help service firm must provide notice to the temporary laborer in the event of a change in the schedule, shift, or location of an assignment for a multi-day assignment.
No temporary help service firm shall send any temporary laborer to any workplace where a strike, a lockout, or other labor dispute exists without providing a written statement at the time of dispatch informing the temporary laborer of the labor dispute, and the temporary laborer’s right to refuse the assignment.
If the temporary laborer is not placed with a third party client or otherwise contracted to work for that day, the temporary help service firm must, upon request, provide the temporary laborer with a confirmation that the temporary laborer sought work, signed by an employee of the temporary help service firm, which shall include the name of the firm, the name and address of the temporary laborer, and the date and the time that the temporary laborer receives the confirmation.
Temporary help service firms in violation of this provision may be fined civil penalties of up to $500 for the first violation and up to $1,000 for subsequent violations.
No Restrictions on Right to Accept Permanent Position
A temporary help service firm may not restrict the right of a temporary laborer to:
-
Accept a permanent position with a third party client to whom the temporary laborer has been referred for work;
-
Restrict the right of a third party client to offer employment to a temporary laborer; or
-
Restrict the right of a temporary laborer to accept a permanent position for any other employment.
Temporary help service firms that violate this provision may be subject to a civil penalty not to exceed $5,000 for each violation found by the Commissioner.
Recordkeeping by Temporary Help Service Firm and Third Party Client
The law contains recordkeeping obligations on the part of the temporary help service firm and third party client.
Whenever a temporary help service firm sends one or more persons to work as temporary laborers the temporary help service firm must keep records relating to that transaction such as:
-
The name, address, and telephone number of the third party client, including each worksite, to which temporary laborers were sent by the temporary help service firm and the date of the transaction;
-
For each temporary laborer: the name and address, the specific location sent to work, the type of work performed, the number of hours worked, the hourly rate of pay, and the date sent. The third party client shall be required to remit all information required under this paragraph to the temporary help service firm no later than seven days following the last day of the work week worked by the temporary laborer;
-
The name and title of the individual or individuals at each third party client’s place of business responsible for the transaction;
-
Any specific qualifications or attributes of a temporary laborer, requested by each third party client;
-
Copies of all contracts, if any, with the third party client and copies of all invoices for the third party client; and
-
Copies of all employment notices provided under this law.
A temporary help service firm must maintain all records for a period of six years from their creation and such records must be available for copying by the temporary laborer or an authorized representative within five days following a written request.
Failure by the third party client to maintain and remit accurate time records to the temporary help service firm may constitute a violation by a third party client and may subject the third party client a civil penalty not to exceed $500 for each violation found by the Commissioner.
Transportation
A temporary help service firm or a third party client, or a contractor or agent of either, may not charge a fee to a temporary laborer to transport the temporary worker to or from the designated work site. A temporary help service firm in violation of this provision may face a penalty of up to $5,000 for each violation.
Private Right of Action
The law includes a private right of action. The right of an aggrieved person to bring an action under the law terminates upon the passing of six years from the final date of employment by the temporary help service firm or the third party client or upon the passing of six years from the date of termination of the contract between the temporary help service firm and the third party client.
In cases where a temporary help service firm has placed restrictions on the right of a temporary laborer to accept a permanent position or the right of a third party client to offer such employment to a temporary laborer, the recovery may be $50 for each temporary laborer affected by the temporary help service firm ‘s policy, practice, or agreement and for each day that policy, practice, or agreement is in effect, plus actual damages, as well as attorney’s fees and costs.
Conclusion
The above rights and protections and obligations imposed upon temporary help service firms (staffing agencies) and the third party clients that use temporary workers should be aware of this new law as its violations could result in liability in court and the imposition of fines.
Organizations should incorporate these obligations and update polices and provide training accordingly. Given the equal pay requirements, it is recommended that employers proactively engage in equal pay audits to ensure compliance.
KSB Law provides Training, Equal Pay Audits and Compliance Services.
This summary is for informational purposes only and is not intended to constitute legal advice. This information should not be reused without permission.
