New Jersey Proposes Measure on ABC Test for Workers’ Compensation Claims

Before someone can receive workers’ compensation benefits following a job-related injury, it must first be shown that they fall within their employer’s coverage. This might seem like a simple proposition, but companies in certain industries are known for their use of independent contractors to perform work. In some cases, the individual truly is acting on their own. While in others, businesses violate the law in order to avoid workers’ comp premiums and other requirements associated with employees.

When a question about someone’s work classification arises, New Jersey courts use what is called the “ABC Test” in order to determine if they’re an employee or independent contractor. This test holds that a worker is presumed to be an employee unless the following three criteria are satisfied:  

• The company has no control or direction over how the worker does their job.
• The worker’s tasks are outside the scope of the company’s business or are performed at a different location.
• The worker is engaged in an independently established trade, occupation, profession or business.

Now, the New Jersey Department of Labor and Workforce Development has proposed a rule to codify the ABC Test so that it would become part of the department’s enforcement mechanism. This likely would make it harder for employers to defend questionable independent-contractor designations in workers’ compensation claims, unemployment benefit cases and disputes over wage and hour issues.

If you were hurt on the job but are being denied benefits based on your purported independent-contractor status, speaking with a qualified attorney can help you understand your legal options. Even if you have an agreement that says you are not an employee, the facts of your situation might support a different result. There are many factors that might affect your true classification, including your hours, assignments, supervision and communications with the party that hired you.  

Should you demonstrate that you are eligible for workers’ compensation benefits, your medical expenses and rehabilitation costs will be fully reimbursed. You can also receive partial wage replacement for the time when your employment-related medical condition keeps you off the job. 

Kevin T. Kutyla, Esq., with offices in Succasunna and Newton, represents New Jersey clients in all types of workers’ compensation matters. Please call 973-940-8970 or contact me online to schedule an appointment at either my Morris or Sussex County location.