Governor Phil Murphy signed the Temporary Workers Bill of Rights (TWBOR) into law in February 2023. The law took effect on August 5, 2023. This law addresses concerns about the wages and protections available to temporary workers employed by staffing agencies. The law aims to prevent temporary workers from being abused or exploited. Although the TWBOR went into effect in August last year, it faced legal challenges. Before the bill was enacted, a group or trade association representing the NJ Staffing Alliance filed a complaint seeking to block it. The district court denied the motion, and the bill went into effect in August. In July this year, the United States Court of Appeals for the Third Circuit affirmed that decision. One month later, the district court denied another attempt to block the law.
The TWBOR offers essential protection for temporary workers employed by staffing agencies. According to the bill, staffing agencies must pay temporary workers no less than the average pay their clients pay their employees for similar work. In addition, staffing agencies should provide equal benefits to employees. The TWBOR aims to eliminate wage disparities that have in the past disadvantaged temporary workers. It is also against the law for staffing agencies to take adverse actions against workers for exercising their rights under the bill. Additionally, for every new assignment, the TWBOR requires workers to be provided with a written notice that includes details such as job description, expected duration of the assignment, and the expected pay rate.
The legal dispute over the Temporary Workers Bill of Rights began with several trade associations filing a suit in May 2023. The plaintiffs wanted the bill blocked from taking effect. They sought a temporary restraining order and preliminary injunction to enjoin the bill on constitutional grounds. A federal judge denied this motion because the plaintiff failed to establish all the elements required for a preliminary injunction. The court also rejected other arguments that the claimants presented.
The plaintiffs appealed the decision to the U.S. Court of Appeals for the Third Circuit. After a thorough assessment, the Third Circuit affirmed the district court’s decision in July 2024. While this appeal was pending, the plaintiffs filed an amended complaint. They added an Employee Retirement Income Security Act (ERISA) preemption claim. In other words, the plaintiffs claimed that the TWBOR is overridden by the ERISA, which sets nationwide standards for employee benefits. The group filed a motion seeking a preliminary injunction on the preemption grounds.
In August, a judge of the United States District Court judge for the District of NJ denied the motion to partially enjoin the TWBOR based on the ERIS preemption. According to the court, the plaintiffs didn’t have an excuse for delaying bringing the ERISA preemption argument. According to the court, granting the preliminary injunction would have substantially altered the status quo. Also, the court found there wasn’t enough evidence to support the claimants’ case. The court explained that more investigation was needed to clarify issues before it could decide on the merits of the ERISA preemptive argument.
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