NJ Appeals Court Finds Title Agency Misclassified Employees As Independent Contractors

From Mondaq, Michael O’Donnell Scott A. Ohnegian and Kori Pruett discuss a recent case in which a New Jersey Appellate court said that title abstractors, notaries, and title agency over closers were employees for the purpose of contributions to unemployment funds. Michaael, Scott and Kori write:

In a decision issued on January 31, 2024, the New Jersey Appellate Division analyzed whether the level of control exercised by a title agent over closers, notaries, and title abstractors rendered them independent contractors or employees for the purposes of contributions under the New Jersey Unemployment Compensation Law and upheld the Commissioner of the New Jersey Department of Labor’s determination that the workers were employees, not independent contractors pursuant to the UCL. Your Hometown Title, LLC v. N.J. Dep’t of Labor & Workforce Dev., No. A-1168-21, 2024 N.J. Super. Unpub. LEXIS 148 (App. Div. Jan. 31, 2024). This decision is of note to title agents and requires a careful review of their vendor agreements

In sum, the Court upheld the Commissioner’s finding that closers, notaries, and title abstractors were employees for purposes of contributions under the UCL due to the specific “instructions and parameters” set forth in the YHT Agreements. Although focused on the UCL, this decision calls into question the nature of the relationship between title agents and the parties they contract with to do closings and title searches, including whether that relationship is susceptible to additional liabilities based on the language of the constraints and requirements set forth in the vendor agreements. Thus, those agreements should be carefully reviewed to be clear on a vendor’s status and responsibilities.

Read the full story at NJ Appeals Court Finds Title Agency Misclassified Employees As Independent Contractors – Constitutional & Administrative Law – United States

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