The New Jersey State Bar Association has joined the growing number of self-employed professionals, freelancers, legislators, nonprofits and business groups who are asking Gov. Mikie Sherrill to delay the Oct. 1 implementation of revised “ABC rules” that will determine whether people are independent contractors or employees.
Meanwhile, NJBIA continues to lead its campaign that seeks the postponement of the rules until July 1, 2027, so that a more comprehensive review of the impacts on professions can be conducted. NJBIA has also created an online form that freelance workers, businesses and consumers can use to ask state policymakers to pause the rule.
The New Jersey State Bar Association (NJSBA) said in a Sept. 22 letter to Sherrill that it was concerned about the impact the revised ABC rules will have on the legal profession, especially solo and small firm practitioners who use the services of per diem counsel as the need arises.
“The ABC test – in particular the revision to Prong C – risks the misclassification of these per diem attorneys for simply lacking formal business trappings, despite functioning as bona fide independent businesses,” the letter states.
“Of greater concern is the open question of the impact of these modified regulations on the use by these smaller firms of limited-scope assistance in addition to per diem attorneys, namely paralegals, accountants, investigators, and the like,” the letter said.
“Even for legitimate contractors, the burden of proof shifts entirely to the firm to show all three prongs of the test. For lawyers in particular, the burden-shift will have a chilling effect, particularly on firms working with new or smaller contractors and professionals such as new parents, semiretired attorneys, or paralegals who may not engage in business formalities, but work independently in fact.”
Small firms maintain independent contractor relationships to manage the firm’s fluctuating caseloads and offer flexible work opportunities – not because they are trying to misclassify workers to avoid paying state taxes, the letter points out.
The letter, signed by NJSBA President Norberto A. Garcia, Esq., said the NJSBA supports the recommendation that Senate President Nicholas Scutari made last month to pause the ABC rule until at least July 1, 2027, to allow for a more comprehensive review of the regulations and their impact on businesses.
Go here to read the entire NJSBA letter.
