[First Reprint]

SENATE, No. 943







Sponsored by:


District 7 (Burlington)






     Establishes system for portable benefits for workers who provide services to consumers through contracting agents.



     As reported by the Senate Labor Committee on February 13, 2020, with amendments.


An Act concerning portable benefits for certain workers and supplementing Title 34 of the Revised Statutes.


     Be It Enacted by the Senate and General Assembly of the State of New Jersey:


     1.    As used in this act:

     “Contracting agent” means a business, organization, corporation, limited liability company, partnership, sole proprietor, or any other entity that facilitates the provision of services by workers to consumers seeking the services and makes payments to workers, where the provision of services is taxed as an independent contractor, using Form 1099.

     “Department” means the Department of Labor and Workforce Development.

     “Principal” means a person or company engaged in the business of manufacturing, who:

     a.     manufactures, produces, imports, or distributes a product for wholesale;

     b.    contracts with a sales representative to solicit orders for the product; and

     c.     compensates the sales representative in whole or in part by commission.

     “Qualified benefit provider” means a nonprofit benefit provider that is eligible to provide benefits to workers of contracting agents pursuant to this act.

     “Worker” means a person who provides services to consumers through a contracting agent.  “Worker” shall not mean:

     a.     any person who contracts to solicit orders in New Jersey as the sales representative of a principal;

     b.    any person subject to a collective bargaining agreement that specifies wages, terms and conditions of employment;

     c.     any person engaged in the sale of financial products or services; or

     d.    any person who is licensed by the New Jersey Real Estate Commission pursuant to R.S.45:15-1 et seq.


      2.   a.  Contracting agents that have facilitated the provision of services by at least 50 individual workers in a consecutive 12-month period shall contribute funds to qualified benefit providers 1designated by the workers1 to provide benefits to the workers of the contracting agents.  The requirement to contribute funds under this act only applies when the services are provided to consumers located in this State.

      b.   (1)  The contribution amount shall be the lesser of 25 percent

of the total fee collected from the consumer for each transaction of services provided or six dollars for every hour that the worker provided services to the consumer.  If determined per hour, then the determination shall be prorated per minute.

      (2)  The contribution amount required under this section may be added to the invoice or billing submitted to the consumer for the services.

      c.   Contributions shall be made to the qualified benefit provider on no less than a monthly basis and no later than 15 days after the end of the month in which the services were provided.

      d.   Contributions shall indicate the assigned amount per worker per transaction, according to the following:

      (1)  if a single worker provided services for a transaction, the entire contribution is assigned to that worker; or

     (2)   if multiple workers provided services for a transaction, the contribution is assigned proportionately to those workers.


      3.   a.  Based on the contributions received under section 2 of this act, qualified benefit providers shall ensure that benefits are provided to workers as set forth in this section.

      b.   Qualified benefit providers shall provide 1to any worker entitled to benefits based on contributions made under section 2 of this act1 workers’ compensation insurance 1as required1 pursuant to chapter 15 of Title 34 of the Revised Statutes 1[to those workers entitled to benefits based on contributions made under section 2 of this act], or,  if the workers’ compensation insurance is not required for the worker, occupational accident insurance which satisfies the minimum standards for that insurance established by regulations promulgated by the Commissioner of Banking and Insurance1.

      c.   In addition to workers’ compensation insurance 1or occupational accident insurance1, qualified benefit providers shall provide some or all of the benefits set forth in this subsection.  Qualified benefit providers shall solicit input from workers on their benefits, and shall allow workers to choose from available benefits or allocate the contributions among the following benefits:

      (1)  health insurance, including but not limited to subsidies to purchase health insurance;

      (2)  paid time off;

      (3)  retirement benefits; and

      (4)  other benefits determined by the qualified benefit providers, on behalf of the workers.

      1The worker may elect to not receive any of the benefits indicated in paragraphs (1) through (4) of this subsection, in which case an amount equal to one half of the contribution required pursuant to subsection b. of section 2 of this act shall be provided as compensation to the worker.1

     d.    Qualified benefit providers may use up to five percent of the contribution funds received for administration of benefits.


     4.    A worker entitled to benefits under this act shall select a qualified benefit provider and shall be given the option to change that selected qualified benefit provider once per year.  Workers shall be provided information regarding available qualified benefit providers in a format that allows them to easily select their chosen qualified benefit provider.


      5.   The department shall adopt rules for organizations to become qualified benefit providers.  At a minimum, the rules governing qualified benefit providers shall require that the following criteria are met:

      a.   the organization shall be a nonprofit organization, operating under 26 U.S.C. s.501(c)(3) federal tax status;

      b.   at least one-half of the organization’s board of directors shall be comprised of workers performing work for customers of contracting agents or representatives of bona fide independent organizations of those workers;

      c.   the organization shall be independent from all business entities, organizations, corporations, or individuals that would pursue any financial interest in conflict with that of the workers;

      d.   all action of the organization regarding providing benefits shall be for the sole purpose of maximizing benefits to the covered workers;

      e.   the board of directors of the organization shall hold a fiduciary duty to the workers with respect to provision of the benefits; and

      f.    the organization shall demonstrate adequate viability and financial sufficiency as determined by the department.  At a minimum, the organization shall have:

      (1)  cash reserves in a sufficient amount, as determined by the department;

      (2)  liability coverage for an amount determined by the department;

      (3)  access to bonding; and

      (4)  other demonstrated competencies as determined by the department.

     1The department shall prepare, post on its website, and make available upon request, a list of qualified benefit providers, and shall update the list not less than one time each calendar year after the year in which it is first prepared.1


      6.   The department shall establish rules to implement and administer this act, including rules for:

      a.   monitoring compliance of contracting agents;

      b.   monitoring qualified benefit providers, including the ability to remove providers that are out of compliance with the criteria established under this act;

      c.   establishing a fee on contracting agents to fund the department’s compliance efforts;

      d.   administering workers’ compensation coverage for workers under this act; and

      e.   providing procedures for workers to select qualified benefit providers, to change their selections annually, and to receive notices of the right to select different qualified benefit providers.

      1The Commissioner of Banking and Insurance shall promulgate regulations to implement and administer minimum standards for occupational accident insurance under this act.1


     7.    In addition to remedies provided by the department to a worker for a contracting agent’s noncompliance, a worker may bring a private cause of action against a contracting agent for the contracting agent’s failure to comply with the contribution requirements under section 2 of this act.


     8.    The requirements on contracting agents and the benefits provided to workers under this act shall not be considered in determinations of a worker’s employment status or a contracting agent’s employment relationship to the worker under R.S.43:21-19.


     9.    This act shall take effect on the sixth month next following enactment, except the Commissioner of Labor and Workforce Development may take any anticipatory administrative action in advance as shall be necessary for the implementation of this act.