New Jersey has adopted regulations codifying the ABC test for determining whether a worker is an employee or an independent contractor, with the new framework expected to take effect Oct. 1, 2026.
Under the ABC test, workers are presumed to be employees unless the hiring entity can demonstrate that the individual is free from control, performs work outside the usual course of the business or outside all places of business of the enterprise, and is engaged in an independently established trade or occupation.
The rule is expected to impact multiple statutes enforced by the New Jersey Department of Labor and Workforce Development, including wage, hour, wage payment, and unemployment laws. While the ABC test is not new in New Jersey, the regulations reinforce the state’s already strict approach and increase the likelihood of continued scrutiny of contractor relationships.
