CWS 3.0: September 25, 2013

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New Jersey Gov. Vetoes IC Truck Driver Bill

Last week, New Jersey Gov. Chris Christie vetoed a bill that would have limited companies’ ability to classify truck drivers as independent contractors.

The bill, the Truck Operator Independent Contractor Act, would have created a presumption that parcel delivery and drayage truck drivers are employees unless they can satisfy a three-pronged statutory test for independent contractor status:

  • the individual has been and will continue to be free from control or direction over the performance of that service, both under his contract of service and in fact;
  • the service is either outside the usual course of the business for which the service is performed, or the service is performed outside of all the places of business of the employer for which the service is performed; and
  • the individual is customarily engaged in an independently established trade, occupation, profession or business.

An employer found to have misclassified an employee as an independent contractor willfully would have been subject to criminal penalties of $2,500 for a first offense, or fines of up to $1,000 per violation (if in error).

Deputy Speaker John S. Wisniewski, who sponsored the bill, addressed the governor’s action in a statement: "[Gov. Christie’s] veto keeps in place a system that is unfair to workers and unfair to those companies that play by the rules. Because of the governor's veto, unethical companies will continue to skirt the law by gaming the system to avoid paying their fair share of taxes.”

The governor issued an absolute veto, which would require two-thirds vote in each chamber to override it. Because the bill passed the senate 21-17 and the state assembly by 43-30, an override is unlikely to occur.

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