NJBIA urged an Assembly committee Thursday to go beyond the recent Senate floor amendments to the service worker retention legislation because, even with these latest changes, the legislation still creates a significant logistical burden for service vendors and will interfere with private business contracts.
“We greatly appreciate the amendments being made to the bill today to remove the criminal penalties for employers and reduce the timeframe for employee retention from 90 to 60 days,” NJBIA Vice President of Government Affairs Alexis Bailey said in her prepared testimony to the Assembly Commerce & Economic Development Committee on A-4682.
“These changes are a welcome improvement for the business community,” Bailey said. “However, we remain concerned about the impact this legislation will have on a business’s ability to change service contract vendors when they need to for legitimate business reasons.”
On Tuesday, the Senate voted to amend the Senate version of the legislation, S-2389, to shorten the worker retention period to 60 days and remove the criminal penalties that could have landed businesses owners in jail. The Assembly Commerce & Economic Development Committee voted 5-3 to adopt identical amendments to the Assembly version of the legislation on Thursday.
Bailey said NJBIA opposes the bill, even with the new amendments, because it still imposes the “most far-reaching iteration of employee retention mandates to date in New Jersey and can have significant health and safety implications for our residents, employees and employers.”
Bailey explained that the bill would still require a new service vendor, referred to as a ‘successor employer,’ to maintain the previous vendor’s employees if they are providing the same type of service.
“For example, if Company A contracts with ABC Cleaning Service to clean their facility and ends that contract to hire XYZ Cleaning Service instead, XYZ Cleaning Service will be mandated to assume ABC Cleaning Service’s employees for 60 days,” Bailey said.
“As evident by this example, successor employers would be mandated to assume another vendor’s employees regardless of whether the original vendor had other work assignments for those employees, if the successor employer had their own employees to bring on to the job, or if the covered location contracting for service work was dissatisfied with the job being done by the previous vendor’s employees,” Bailey said.
“This provision unnecessarily entangles three separate business entities into contracts and makes it impractical to ever change service contracts, stifling competition, efficiency as well as consumer health and safety,” Bailey said. “We implore the committee not to advance this legislation without removing vendor to vendor contract changes from the definition of successor employer in the bill.”
In addition, the bill broadly defines service employees and covered locations and will impact a significant number of businesses, negatively impacting large swaths of the state’s economy, Bailey said.
“Employers and facilities captured under this legislation include multifamily residential buildings with more than 50 units, commercial or office buildings that are more than 100,000 square feet, primary, secondary and tertiary schools, as well as cultural centers such as museums, convention centers, arenas, performance halls, industrial sites, pharmaceutical labs, airports, train stations, hospitals, nursing care facilities, senior care centers and other healthcare provider locations, state courts and warehouse and distribution centers,” Bailey said.
Several lawmakers who voted to advance the bill from committee on Thursday said they would be urging the sponsors of the legislation to consider further amendments before the measure is voted on by the full Legislature to address some of the concerns raised during the hearing. This includes possibly narrowing the scope of the legislation to address retention of workers after the sale of a business, instead of the current language that of a mere change in service contracts.
