NJ relies on ABC Test to determine if a Worker is an Employee or Independent Contractor

ABC blocks

From WestlawNext (subscription required) —  The Superior Court of New Jersey, Appellate Division said

The Unemployment Compensation Law (UCL), N.J.S.A. 43:21–1 to –71, provides that employment is “service performed on or after January 1, 1972 … for remuneration or under any contract of hire, written or oral, express or implied.” N.J.S.A. 43:21–19(i)(1)(A). The UCL has been interpreted as establishing a “presumption … that all services performed by an individual for remuneration,” with the exception of those excluded under the terms of N.J.S.A. 43:21–19(i)(7), are employment unless the putative employer meets its burden of establishing that the services were not employment under each of three standards that comprise the so called ABC Test. Philadelphia Newspapers, Inc. v. Board of Review, 397 N.J.Super. 309, 319 (App.Div.2007), certif. denied, 195 N.J. 420 (2008); see Carpet Remnant Warehouse v. N.J. Dep’t of Labor, 125 N.J. 567, 571 (1991) (indicating that the question whether carpet installers are employees or independent contractors depends on whether the employer is able to satisfy the criteria of “the so called ABC test”). The ABC test is set forth in N.J.S.A. 43:21–19(i)(6)(A)–(C) as follows:

Services performed by an individual for remuneration shall be deemed to be employment subject to this chapter ( [N.J.S.A.] 43:21–1 to –71] ) unless and until it is shown to the satisfaction of the division that:

(A) Such individual has been and will continue to be free from control or direction over the performance of such service, both under his contract of service and in fact; and

(B) Such service is either outside the usual course of the business for which such service is performed, or that such service is performed outside of all the places of business of the enterprise for which such service is performed; and

(C) Such individual is customarily engaged in an independently established trade, occupation, profession or business.

The three parts of “the ABC Test are commonly referred to as the ‘control test,’ the ‘course-of-business or location-of-work test,’ and the ‘independent-business test,’ respectively.” Philadelphia Newspapers, supra, 397 N.J.Super. at 320.

Read the full case at ABS Group Services, Inc. v. Board of Review, Dept. of Labor

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