On May 5, the New Jersey Staffing Alliance, an ASA-affiliated chapter, along with the New Jersey Business and Industry Association—with support from ASA—filed a civil lawsuit against the state of New Jersey and various institutional and individual defendants in the U.S. District Court for the District of New Jersey. The lawsuit challenges the validity of A 1474, a first-of-its-kind law recently enacted in New Jersey that regulates the staffing industry by mandating temporary employee wage and benefits payments equivalent to those received by client employees performing similar work; limiting conversion fees; and prohibiting agencies from charging a fee for providing transportation.
Among other claims, the lawsuit alleges the new law violates the Commerce Clause of the U.S. Constitution. The lawsuit further alleges the new law’s vagueness violates the Due Process Clause of the Constitution and that it separately violates the Constitution’s Equal Protection Clause. Accordingly, the suit seeks a court order restraining the state of New Jersey from enforcing or implementing the law.
A 1474 applies to construction, light industrial, and other workers, but not to professional or clerical workers. Over the prior 10 months, ASA and NJSA, along with their member staffing agencies, engaged in an extensive grassroots campaign explaining to legislators why the bill is bad for workers and the staffing industry. Those efforts blocked three previous attempts to pass the bill, but ultimately the overwhelmingly pro-labor forces prevailed.
Since the bill’s passage, ASA, NJSA, and industry lobbyists have been in conversations with state senators. ASA and NJSA officials also met with the New Jersey Department of Labor in early March regarding forthcoming regulations implementing the new law and followed up with written suggestions regarding the regulations. Among the areas of concern were the law’s equal pay provision—including the definition of “benefits” and “same or substantially similar work”—the limitation on conversion fees, and the transportation provisions.
Section 3 of the new law, which imposes new employee notification requirements on staffing agencies, and Section 10, which prohibits retaliation against employees that exercise their rights under the law, became effective May 7. Most of the law’s other requirements are set to become effective Aug. 5. However, NJDOL officials earlier informed ASA and NJSA that it is highly unlikely that final rules will be ready by August. They also said they would proceed with a “light enforcement touch” until final regulations are published and investigators are properly trained. NJSA and ASA published a detailed issue paper about the law, which is available at americanstaffing.net.
NJSA, NJBIA, and ASA are represented by the New Jersey law firm of Javerbaum Wurgaft Hicks Kahn Wikstrom & Sinnis PC.
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