The Sherrill administration has officially adopted the New Jersey Department of Labor and Workforce Development’s (NJDOL) independent contractor rule proposal, which revises the state’s interpretation of the ABC test used to determine whether a worker is classified as an employee or independent contractor. The proposal was originally introduced under the Murphy administration on May 5, 2025, and today marked the deadline for the administration to either adopt or abandon the rule.

While the administration adopted amended regulations, NJDOL has announced a 120-day stay(until October 1, 2026) before the rules become effective to allow additional discussions with the Legislature regarding potential statutory changes.

The adopted rules reinforce New Jersey’s already strict ABC test framework, under which a worker is presumed to be an employee unless a business can satisfy all three prongs of the test. Businesses and independent contractors alike have also raised concerns that the rules could limit workforce flexibility and reduce opportunities for freelance and project-based work arrangements that many workers and employers rely upon.

The CCSNJ submitted formal comments to the NJDOLWD opposing the proposed rule, citing concerns about its potential impact on businesses, workforce flexibility, and independent contractors operating throughout New Jersey. The CCSNJ will continue to closely monitor developments and work with the Legislature and administration during the 120-day stay period to advocate for greater clarity, flexibility, and predictability for South Jersey businesses and independent contractors.We encourage members to review their independent contractor classifications and consult legal counsel for guidance.