As we previously reported, on May 8, 2023, the New Jersey Department of Labor and Workforce Development (“NJDOL”) published a web page providing guidance in the form of Frequently Asked Questions (the “FAQs”) to assist employers in complying  with the provisions of the Temporary Workers’ Bill of Rights (the “Law”). Recently the NJDOL released proposed regulations to implement the Law (the “Proposed Regulations”) that elaborate on many of the Law’s provisions, including its pay equity requirement.  Public comment on the Proposed Regulations will be accepted until October 20, 2023.

In addition to the Proposed Regulations, the NJDOL has also updated its FAQs.

Summary of Proposed Regulations

Pay Equity Calculation Guidance

One of the more significant provisions in the Proposed Regulations provides guidance on how to calculate and enforce the Law’s pay equity requirements. The Law prohibits paying temporary laborers less than the average rate of pay and average cost of benefits, or cash equivalent, of third-party client employees performing the same or substantially similar work (referred to as “comparator employees” in the Proposed Regulations). The Proposed Regulations require third-party clients to determine the comparator employees, before providing the temporary help service firm with “a listing of the hourly rate of pay and cost per hour of benefits for each comparator employee.” The Proposed Regulations state that, if a comparator employee is paid on a salary basis, “the hourly rate of pay for the comparator employee shall be calculated by dividing the annual salary paid to the comparator employee by 2,080 hours.” Likewise, “[t]o calculate the cost per hour of benefits, the annual cost to the employer of benefits shall be divided by 2,080 hours.” The temporary help service firm then takes the sum of the average hourly rates and benefits of all comparator employees, subtracting the cost per hour of benefits provided by the temporary help service firm, to determine the temporary laborer’s rate of pay.

 The Proposed Regulations provide a list of twelve principles employers should apply when determining whether a temporary laborer and an employee of the third-party client are performing substantially similar work. Notably, the Proposed Regulations do not provide detail on calculating the value of benefits except to define the term “Benefits” to mean “fringe benefits, including but not limited to, health insurance, life insurance, disability insurance, paid time off (including vacations, holidays, personal leave and sick leave in excess of what is required by law) training, and pensions.” The definition of Benefits excludes fringe benefits an employer must provide to its employees by law, such as New Jersey Earned Sick Leave.

Summary of New FAQs

Applicability of the Law to Temporary Laborers Assigned to Work Outside of New Jersey

Notably, the updated FAQs state that temporary help service firms that are located, operate, or transact business within New Jersey must comply with the Law’s requirements, regardless of whether the temporary laborer has been assigned to work in New Jersey or outside the state. The location of the worksite is not to be considered, and the Law’s requirements “apply to temporary laborers who are assigned by a covered temporary help service firm to work outside of New Jersey.”  

Temporary Laborer Assignment Notification Form FAQs

Under the Law, a temporary help service firm must provide a Temporary Laborer Assignment Notification form (the “Form”) to each temporary laborer upon assignment to a temporary position. The Form contains information concerning the temporary help service firm, the third-party client that the temporary laborer will perform work for, and various information describing the work assignment and its requirements. The FAQs provide several pieces of guidance regarding compliance with the Form’s requirements, including:

• If a temporary laborer’s assignment occurs through text, email or other electronic exchange, the temporary help service firm must provide the Form in the same manner.

• It would be “wise” for the temporary help service firm to record that the temporary laborer successfully received the Form at the time of dispatch.

• Temporary help service firms must use the Form provided and approved by the Commissioner.

• Information regarding the schedule and duration of the assignment should be “as specific as possible,” which may require asking the third-party client for additional details. Even so, the temporary help service firm must only make a “good faith effort at compliance” and is not required to specify the length of the assignment if it truly does not know.

• Stating whether any licenses are required for the temporary assignment including, “any formal licensure or certification that the individual might need to engage in an occupation or an occupational activity that is among the requirements for the assignment.”

• The Form’s sections require a description of “the name and nature of [the] work to be performed” and a “description of the position”:

  • The “name and nature of [the] work” section requires “a more general characterization of the type of work,” and

  • The “description of the position” section requires “a more detailed description of the job, including the duties to be performed.”