The New Jersey Temporary Workers Bill of Rights Explained

Understanding the New Jersey Temporary Workers Bill of Rights

Temporary workers are a valuable but often overlooked force in the economy since expanding payroll with additional permanent employees doesn't always make sense. Many organizations may need interim help from ancillary staff. Working with agencies that supply temp workers gives companies the flexibility they need to meet their goals cost-effectively. However, in one state, the rules surrounding temporary employees have recently undergone a substantial change. The introduction of the New Jersey Temporary Workers Bill of Rights is something employers and especially staffing agencies in the state must understand.

According to state sources, there are more than 130,000 individuals in New Jersey employed in a temporary capacity. Temp positions may not last long, and they often do not confer any benefits to employees. As a result, many of these people are in a precarious position—and their compensation may not always align with what they need or what the law demands. Issues related to compensation drove the creation of the new Workers' Bill of Rights, but the law also contains additional provisions meant to protect such employees and expand their opportunities.

For employers who use outside staffing agencies in New Jersey, there are some indispensable new considerations to make before hiring individuals from such partners. For staffing agencies, significant changes have arrived in the areas of compensation and worker rights. The law went into effect on August 5, 2023, and employers must now comply with the rules or face fines and other actions.

What do you need to know about this compliance update? First, let's focus on the specific targets of the law—regarding employers and employees—then we'll dig into what it takes to comply.

Who does the new law cover?

The law does not explicitly cover all temporary staffing agencies in the state of New Jersey. Instead, it requires compliance from agencies that place staff in job categories at a high risk of abuse. Whenever an agency places a candidate into a temporary role for such a position, even if the contract only lasts for a single day, they must still abide by all the provisions of the law. So, does that mean that employers who use such agencies are off the hook?

Not quite. One of the key provisions of the law, which we'll discuss later in this article, concerns how staffing agencies pay employees. Businesses will need to provide their staffing partners with specific information about employee compensation and benefits to establish the appropriate level of payment. Failing to do so could mean losing access to temp workers because of the agency's need to rely on numbers you supply for their wage calculations.

What types of temporary employees receive coverage?

Rather than applying the law broadly to all agencies, New Jersey legislators worked to identify occupational categories where temporary workers most often face exploitation. For the purposes of drafting the law, New Jersey used the federal Department of Labor's job classification index. Let's explore each category receiving new protections in New Jersey alongside a few examples of such workers. Covered categories include:

• Transportation and Material Moving, including jobs such as flight attendants, bus drivers, and parking attendants.
• Production Occupations, such as food processing workers, metal workers, etc.
• Helpers in Construction Trades, including those assisting carpenters, electricians, and roofers.
• Construction Laborers.
• Installation, Maintenance, and Repair, including mechanics, service technicians and many more.
• Personal Care and Services, such as childcare workers, amusement park attendants, and others.
• Building, Grounds Cleaning and Maintenance, including custodial staff/janitors, landscapers, and maids.
• Food Preparation and Serving, including cooks, dishwashers, and waitstaff.
• Other Protective Service Workers, such as security guards, crossing guards, or lifeguards.

For a complete list of jobs that fall under these categories, consult the Department of Labor's website. New Jersey's law also includes provisions for updating these categories based on any future classification changes created by the DOL.

The central provision of the law: equitable compensation

Pushing for parity in compensation between full-time and temporary workers is the most notable provision of the law. The pay equity provisions apply to all the work categories defined above when hired through a staffing agency. Such agencies must provide compensation to individual employees that aligns with the compensation a similar full-time employee of a client business would receive. In other words, a temporary office worker must receive the same wages as an equivalent regular employee in the business.

More importantly, agencies must also factor in the average cost of all the benefits such comparable employees receive. Rather than providing temps with health insurance, life insurance, paid time off, and other benefits, agencies must provide an approximately equal amount of cash. Agencies will need to work closely with their partners to make these calculations.

Partner companies using staffing or temp agencies must identify the full-time employees who perform the job most comparable to a requested temp. They must then furnish their agency partners with compensation and benefit value data. These numbers then factor into the wages ultimately provided to temp workers. If a temporary employee arrives at a site for an assignment and there is no work to perform, they must receive at least four hours of pay at this calculated rate.

Does the Temporary Workers Bill of Rights Impact Background Checks and Compliance?

Even for temporary laborers, it's often necessary to conduct a background check to protect both the staffing agency and its clients. In some cases, such vetting may even be a requirement of other laws. The new Bill of Rights contains some language that does impact these processes.

In the past, staffing agencies might deduct the cost of a background check from an individual's wages for a temporary job. That is now illegal. Under the new law, agencies cannot deduct wages or require candidates to pay for background checks or drug tests.

The law also includes all "consumer report expenses" and transportation fees. Agencies will need to bear these costs themselves. Connecting with a background screening knowledgeable and equipped company to support staffing agencies, such as backgroundchecks.com, can simplify this element of compliance.

Preparing for Compliance and Looking to the Future

After a failed effort in the courts to put a stop to the law, the new Bill of Rights went into effect in August 2023. Public comment on the law closed the following month, and the state continues to publish and update guidance on how agencies and their clients should make efforts to comply. Remember, there are many ways that companies could incur fines for non-compliance—so a thorough review of your procedures is mandatory.

Will other states follow suit with similar laws? That remains to be seen. Nonetheless, since this law can affect even agencies placing staffers outside of New Jersey, more companies should take notice. Review the law, determine what obligations you may have, if any, and act today. For others, the New Jersey Temporary Workers Bill of Rights is a good reminder: substantial changes can come to industry more quickly than you might expect. Monitor legislation and regulations in your area and be ready to respond.