The New Jersey Senate Judiciary Committee is scheduled to meet at 10 a.m. today in Trenton. A number of nominees for various positions are on the agenda, including Kevin Jarvis, who is Governor Mikie Sherrill’s nominee to serve as the state’s labor commissioner.
In his capacity as acting labor commissioner, Jarvis already adopted the state’s ABC Test rule for independent contractors, which faced 99% public opposition as well as public statements of concern from two dozen lawmakers on both sides of the political aisle.
Jarvis has also defended the adopted rule in the press, claiming that this widespread concern and opposition is rooted in “a river of misinformation.”
There are a number of topics that I’m sure the senators will be asking Jarvis about today. Here are five questions I’d like to see them ask about the independent-contractor policy situation, in particular.
Question 1
The independent-contractor rule that you just adopted faced 99% public opposition in the estimated 9,500 written public comments filed with New Jersey’s Labor Department. Only about two dozen comments were filed in support, and most of them were from unions or organizations with strong union ties, such as the multimillion-dollar Economic Policy Institute in Washington, D.C., whose chairwoman is Liz Shuler, the head of the AFL-CIO.
You told the publication Law360 that you only considered about 250 of the opposition comments to be “unique” because a lot of people signed form letters and sent them in. You also told Law360 that a single comment in support of the rule should count as representing “thousands or upward to a million” people. You repeated this claim in your testimony before the Senate Labor Committee in May.
The way you weighted these public comments not only seems to minimize the concerns of thousands of New Jerseyans who earn some or all of their income as independent contractors, but also appears to discount organizations such as the New Jersey Bar Association, whose opposition comment represented more than 16,000 members; the roadside assistance network AAA, whose opposition comment cited more than 885,000 drivers from New Jersey calling to use the service in a single year; and the childhood development experts who submitted an opposition comment about effects on New Jersey’s Early Intervention System, which serves roughly 15,000 infants and toddlers with developmental disabilities and delays.
Why do you believe a single comment from a union leader should count as many as a million times, while thousands other comments that in some cases represent tens or hundreds of thousands of New Jerseyans should be characterized as only “about 250 unique letters”?
Question 2
You previously worked as the legislative affairs coordinator for the New Jersey AFL-CIO. And you made clear, in your comments to Law360, that you weighted supportive written public comments from organizations such as the New Jersey AFL-CIO differently than you weighted opposition comments from non-union organizations.
That alone raises concerns about whether you, as labor commissioner, would be working for the people of this state or for the union organizers. Especially since, according to the U.S. Bureau of Labor Statistics, less than 15% of New Jersey’s wage and salary workers are union members.
So please tell us: During the eight months since you became acting labor commissioner in February, how many times have you met with union officials; how many times have you met with independent contractors; and how many times have you met with organizations such as the New Jersey Chamber of Commerce and the New Jersey Business & Industry Association?
Question 3
In May, you testified before the Senate Labor Committee that in the past seven years, more than 4,700 gig workers applied to the Labor Department for unemployment insurance benefits. You also testified that in the past two years, more than 1,400 gig workers applied. “Those are big numbers,” you said in your testimony.
But anyone who does the math can see that those numbers only amount to about 700 people on average each year—in a state with an estimated 1.7 million people earning some or all of their income as independent contractors. What you called “big numbers” actually represents less than 1% of independent contractors in New Jersey.
And according to information that the Labor Department, under your supervision, provided to Senator Declan O’Scanlon, only a single type of independent contractor, rideshare drivers, filed almost all of those recent claims.
Economists have documented that not just rideshare, but all types of app-based workers combined—that’s Uber, Lyft, DoorDash, Instacart, TaskRabbit, all of them—comprise less than 10% of independent contractors.
Why do you believe that less than 1% of people involved in a type of work that involves less than 10% of independent contractors justifies rulemaking that—as one attorney described it—is based on “one of the most business-unfriendly tests for independent-contractor status in the country and interprets that test in a particularly unhelpful manner”?
Question 4
Page 183 of the adopted independent-contractor rule states that the Labor Department—which you are now seeking confirmation to lead—“is not obligated to address economic research on the impact of the ABC test.”
This statement seems like a complete abdication of the Labor Department’s own mission statement, which claims that the department “is dedicated to protecting our workforce, strengthening our businesses, and promoting the dignity of work.”
Economists submitted research on the impact of the ABC Test here in New Jersey as part of the public-comment process. They found that use of the ABC Test in our state has already led to harmful effects compared to states that do things differently:
a 3.81% decrease in W-2 employment
a 10.08% decrease in self-employment
a 3.95% decrease in overall employment
This research by economists also noted that “the New Jersey data reveals stark gender disparities: women’s traditional W-2 employment declined by 7.40%, while men’s showed no significant change—raising concerns about disproportionate impacts on women following the policy change. This pattern suggests the policy may inadvertently create gender-specific barriers in the labor market while failing to deliver its promised worker protections.”
Notably, those findings about the ABC Test causing disproportionate harm to women in New Jersey mirror what members of the California Advisory Committee to the U.S. Commission on Civil Rights reported about similar use of the ABC Test in that state.
If the New Jersey Labor Department’s mission is to protect our workforce, strengthen our businesses and promote the dignity of work, then how is it reasonable to ignore economic research showing that use of the ABC Test is decreasing W-2 employment, self-employment and overall employment, with disproportionate harm to women?
Question 5
Prior to this rule taking effect October 1, numerous bills were introduced to exempt financial advisers, insurance agents, golf caddies and amateur sports officials—with testimony before the Legislature that the adopted rule continues to threaten their livelihoods. In addition, after this rule took effect October 1, another bill was introduced that would protect at least 40 more professions ranging from writers and editors to photographers and dancers.
Several of these bills are sponsored by Senate Labor Committee Chairman Gordon Johnson. He is just one among numerous high-ranking members of this body, including Senate President Nicholas Scutari and Senate Republican Leader Anthony Bucco, who asked for this rule’s effective date to be delayed until July 2027, to give the Legislature time to work on independent-contractor legislation.
There also has been a request from the New Jersey Chamber of Commerce and the New Jersey Business & Industry Association to create “a balanced task force representing workers, organized labor, independent contractors, employers, nonprofits, and other affected stakeholders,” as part of an effort to “develop a framework that targets genuine misclassification without jeopardizing legitimate independent work.”
And, since May, the New Jersey Senate has had in the public record a 98-page report that details, at great length, the mischaracterized data and research about independent contractors in the findings by Governor Phil Murphy’s Task Force on Employee Misclassification—findings that this Legislature was repeatedly led to believe were true.
Page 192 of the adopted independent-contractor rule states that “critique of the work of 2019 Misclassification Task Force Report is not relevant to this rulemaking.”
The Labor Department’s stance about ignoring mischaracterized data and research seems just as unreasonable as the Labor Department’s stance that there is no obligation to address economic research on the impact of the ABC Test.
If you are confirmed as labor commissioner, would you pledge to delay all enforcement based on this rulemaking, and to support the creation of a balanced task force with a target date of July 2027 for the Legislature to consider all of this and more, and to develop a framework that targets genuine misclassification without jeopardizing legitimate independent work?