The State of New Jersey published its final regulations on the Temporary Workers Bill of Rights. The comments and responses accompanying the regulations shed significant light on how the State wants temporary help service firms and their clients to meet their obligations under the law. This is particularly true for the law’s temporary worker equivalency requirement.
The Temporary Workers Bill of Rights requires a temporary worker to be paid “no less than the average rate of pay and average cost of benefits, or the cash equivalent thereof, of employees of the third party client performing the same of substantially similar work on jobs the performance of which requires equal skill, effort and responsibility, and which are performed under similar working conditions” for the client at the time the temporary worker is assigned to work at the client site. N.J.S.A. 34:8D-7.
During the comment period, many comments and questions were raised about how to interpret and implement this language. Here is what we now know.
How do we know if a third party client has direct employees “equivalent” to a temporary worker? The State provided a “list of principles that should be applied when determining whether a temporary laborer and an employee of the third-party client are performing substantially similar work.” 56 N.J.R. 1859, Comment 34. Application of this list of principles is subjective and many third party clients will likely find its implementation difficult.
When a temporary help service firm contracts with a third party client, the client must provide a list of equivalent workers and each worker’s rate of pay and the annual cost of benefits paid by the client for that worker. This list of equivalent workers does not have a geographical limit and is not limited to the specific worksite. As the State writes, there is nothing in the law that suggests that “the identification of comparator employees of the third-party client should be limited to a geographical scope, or that it should be limited to a department or facility of the third-party client, or to facilities of the third-party client within the State where the temporary laborer is being assigned.” 56 N.J.R. 1861, Comment 36.
In effect, the law has the potential to place a significant burden on a third-party client when the client must generate this “equivalent worker” list.
Once the third-party client provides its equivalent worker list, the temporary help service firm must follow the step-by-step instructions provided in the regulations for how to calculate the “equivalent” hourly rate of pay for the temporary worker.
The published final regulations clarify that this calculation must be done for each temporary worker each time a worker is assigned to a new client. For this reason, the “equivalent” hourly rate of pay may be differ between workers even when they are doing the same work at the same client.
Commenters asked what types of benefits need to be included in this calculation. That State has not provided a limit. In fact, the State’s interpretation of “benefits” under this provision is broad.
Commenters also asked whether a temporary help service firm may rely on the “equivalent worker” information provided by a client. The State responded that while the client is responsible for providing accurate information, “both the temporary help service firm and third-party client are jointly and severally liable” if a worker is not paid the appropriate hourly rate. 56 N.J.R. 1862.
While these regulations, comments and responses provide clarity, they confirm that this legislation is creating the heavy administrative burden that temporary help service firms and their clients feared. Temporary help service firms and their clients are encouraged to study the State’s regulations and take steps to implement procedures and safeguards to ensure compliance and avoid violations.
