NJBIA is asking the state agency responsible for issuing the regulations for the Temporary Workers Bill of Rights law to take a closer look at the way wages would be calculated for temp workers because it could end up requiring temps to be paid more than the company’s regular workers.
Under the law, businesses who hire temp workers cannot pay them less than the average rate of pay and the average cost of benefits, or cash equivalent, of its regular employees who are doing essentially the same work. The Department of Labor and Workforce Development’s proposed rules are meant to provide guidance on the complex pay equity calculations, but NJBIA says the rules still fall short and need revising.
“In the rules proposed by the Department, seniority, family size, specific benefit selection for health benefits and client company pay scales are not considered in the average salary and benefits calculations,” NJBIA Chief Government Affairs Officer Christopher Emigholz wrote, noting that the law itself does not define the word ‘average’ nor the comparable workers used to determine that average.
“Failing to include seniority and existing client company pay scales will lead to an imbalance and inequity from temporary workers making more money than more experienced workers or workers with larger benefit costs because of family size,” Emigholz said in written comments submitted to DOL on Oct 18.
“To streamline the process for calculating the cost of benefits, the rules should allow third-party clients to establish a standard baseline amount, especially for the portion of benefits attributable to healthcare,” Emigholz said. “For example, a standard health benefits amount could be based on employee-only coverage rates to avoid single temporary workers with no dependents getting the average benefits of third-party client employees with benefits that cover their large families.”
Emigholz said companies that hire temp agency workers are also concerned about sharing their wage and benefit information that they believe to be proprietary, and the proposed rules do not adequately offer protection of this information even though the statute itself potentially allows that.
“NJBIA proposes that client companies be responsible for calculating their own average wage and benefits and sending that information to temporary worker agencies,” he said. “If this were done with greater protection of proprietary information, instead of sending the full pay scale information to the temporary worker agencies, the mutually beneficial partnership between temporary worker agencies and their clients would be preserved, maintaining better economic opportunities for both.”
Emigholz said the rules also don’t offer businesses clarity on how average wages and benefits used for temp worker pay equity purposes are calculated at different points in the calendar year. It would be more efficient if the rules allowed third-party clients to calculate these rates for relevant positions on a set schedule, such as two times per year or quarterly, he said.
