💼 Up to 1.7 million NJ freelancers, gig workers and 1099 contractors could be impacted by controversial new labor rules.
⚖️ Independent contractors packed a tense Senate hearing Monday, pleading with lawmakers to protect their flexible livelihoods.
📉 Business groups warn the Sherrill administration’s crackdown could make New Jersey even harder and more expensive to do business.
Gov. Mikie Sherrill’s administration is facing mounting backlash over controversial new labor rules that could effectively eliminate independent contractors, gig workers and thousands of 1099 jobs across New Jersey.
The fight exploded during contentious testimony Monday before a Senate committee, where freelancers, truck drivers, consultants, musicians, real estate professionals and small business owners warned lawmakers the state is threatening the very flexibility that allows them to earn a living.
At issue are newly adopted Department of Labor regulations tightening New Jersey’s interpretation of the so-called “ABC test” used to determine whether a worker qualifies as an independent contractor or must instead be classified as an employee.
Gov. Mikie Sherrill via Facebook/Canva/TSQ illustration
Gov. Mikie Sherrill via Facebook/Canva/TSQ illustration
Critics say the rules could impact as many as 1.7 million independent workers statewide.
Independent contractors plead with lawmakers to stop NJ crackdown
Business groups and workers packed Monday’s Senate Labor Committee hearing urging lawmakers to overturn or substantially rewrite the regulations before they take effect Oct. 1.
The New Jersey Business & Industry Association called the rule “a job killer” and noted the proposal generated thousands of public comments in opposition.
Many of those workers made the same point repeatedly during testimony: they do not want to become employees.
They want flexibility.
They want independence.
And they want Trenton to leave them alone.
For years, independent contractors across New Jersey have argued they intentionally chose freelance and gig work because it gives them the ability to control their schedules, work for multiple clients, care for children or aging parents, supplement retirement income or build their own businesses.
Uber and Lyft
Uber and Lyft drivers worry new labor rules are too strict to allow them to work independently in New Jersey. (Unsplash)
Opponents say the new rules ignore that reality entirely.
The Labor Department insists the changes are designed to combat worker misclassification and create clearer enforcement standards. Acting Labor Commissioner Kevin Jarvis said the regulations are intended to protect workers and prevent responsible businesses from being undercut by companies that improperly classify employees as contractors.
NJ gig workers warn flexibility and income could disappear
The controversy has simmered for more than a year and survived a temporary regulatory freeze ordered by Sherrill shortly after taking office.
More than 9,000 public comments were submitted during the rulemaking process, with critics claiming overwhelming opposition came from actual freelancers and small business owners.
Industry groups warn the rules could hit everyone from Uber drivers and freelance writers to yoga instructors, electricians and accountants.
Many businesses argue the state’s increasingly aggressive labor policies are making New Jersey even less competitive and more hostile to employers already struggling with high taxes, insurance costs and regulatory burdens.
Some lawmakers from both parties have also raised concerns. Legislative resolutions have already been introduced seeking to invalidate the rules as inconsistent with legislative intent.
Business groups say New Jersey keeps making it harder to operate
For critics, the larger concern goes beyond labor classification.
They argue New Jersey government continues inserting itself into private business decisions while ignoring what independent workers themselves are saying.
The fear among many contractors is simple: businesses unable to comply with the stricter rules may simply stop hiring freelancers altogether.
Further complicating this matter is the ambiguity of the actual regulations that have been adopted.
Kim Kavin testifies before the Senate Labor Committee in Trenton on 5/11/2026. (Kim Kavin via Facebook)
Kim Kavin testifies before the Senate Labor Committee in Trenton on 5/11/2026. (Kim Kavin via Facebook)
Freelance writer Kim Kavin is a vocal critic who has joined me on ‘Jersey Thing’ to warn about these changes. She was among those testifying on Monday.
She stressed that the rules are not clear. “New Jersey’s labor department says it may consider some factors in one case nut not in another case. The department says it may consider factors that aren’t listed anywhere, so who knows what matters?”
While the Sherrill administration has adopted the new rules, the governor has left it up to the legislature to codify the rules and carve out any exemptions.
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In the first quarter of 2025 alone, roughly a dozen New Jersey employers announced over 3,000 layoffs. By October, the number of layoffs announced was beyond 11,000.
Gallery Credit: Erin Vogt
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