US Labor Secretary Visits NJ: Promises a New Approach to Ergonomic Regulations by OSHA
During an April 11 visit to Paramus, US Secretary of Labor Elaine Chao met with New Jersey business leaders to discuss the President's new budget and a variety of workplace issues. NJBIA Vice President Jeff Stoller urged Chao to repeal the notorious 1999 "Baby UI" opinion, issued by the Labor Department under President Clinton, which sparked a fierce debate over paid family leave in New Jersey and other states.

The Department contradicted decades of court rulings and its own regulations by suggesting that state unemployment insurance (UI) benefits could be paid to new parents. The opinion was immediately challenged in court, and no state in the country has yet enacted a UI paid leave mandate. Secretary Chao said the DOL should take a look at the Clinton-era opinion and noted that many employers in the room were nodding their heads in agreement! Bob Roberti, chair of the Essex County Employer Legislative Committee, also thanked Secretary Chao for President Bush's decision to end the use of project labor agreements (PLAs) on federal construction projects. PLAs drive up the cost of public construction by shutting out competitive bids from reputable nonunion firms and automatically awarding the contracts to companies tied to politically powerful unions. Boston's multibillion dollar "Big Dig" fiasco shows how PLAs send costs soaring when the government shuts out legitimate contractors whose past work was completed on time and within budget. Shortly after her visit to New Jersey, Secretary Chao told a US Senate committee that the Labor Department would take a new approach to regulating ergonomic (repetitive motion) injuries. Last March, Congress rejected a proposed ergonomic rule by the US Occupational Safety & Health Administration. Chao explained that OSHA regulators failed to adequately review thousands of industry complaints about the ergonomic rule. Chao envisions a narrower regulation, targeting high-risk occupations instead of the general business community. She observed that repetitive motion injuries fell 25 percent between 1993 and 1999 without a standard.

NJ Cracks Down on Businesses That Hire Outside Contractors
Watch out! The New Jersey Department of Labor is penalizing businesses that mistakenly classify employees as "independent contractors." Companies may be liable for thousands of dollars in overdue Unemployment Insurance and Temporary Disability Insurance contributions if the Department finds an employer-employee relationship exists with outside vendors. Businesses often hire "independent" contractors in good faith only to discover, years later, that they never worked for any other employer.

In 1991, the New Jersey Supreme Court ruled in the Carpet Remnant Warehouse case that an employer's liability for unemployment compensation can be determined in part by how much income the contractor received from other customers. Your company may be required to pay up if all or most of the contractor's income came from you. In 1999, the Appelate Court ruled against the employer in a similar case (Alladin Service Corp. v. DOL). Workers whom the business claimed were "independent" could not produce evidence of any other business clients, business stationery, outside advertising, office space, billing statements, a trade name or a business telephone number. The chief auditor of the NJ Department of Labor has provided NJBIA with a Subcontractor Information Sheet that independent contractors should fill out to prove they are employers registered with the state. Any "contractor" who is not registered is considered an "employee." Obtain Subcontractor Information Sheet here. Copies can also be obtained from Sara Bluhm at 609-393-7707, ext. 204, or sbluhm@njbia.org).

Bush Rolls Back Labor Rules on Union Organizing, Employer Blacklisting
On April 3, the Bush Administration announced it was suspending the so-called "blacklisting" regulations that would have declared contractors ineligible to bid on public contracts due to past labor and environmental penalties. The regulations are so loosely written that reputable firms could be denied the chance to bid on the basis of minor or technical violations. There is also concern that mere allegations of wrongdoing by rival contractors or unions would be enough to deny any federal contracts to a company under this rule.

Interested companies have until June 4, 2001 to request the permanent repeal of the blacklisting rule. Comments should reference "Proposed Rule FAR case 2001-014" and be directed to:

General Services Administration
FAR Secretariat (MVP)
1800 F Street, N.W., Room 4035
Washington, D.C. 20405
or to e-mail address: farcase.2001-014@gsa.gov.

The US Labor Department announced on April 11 that it would rescind a Clinton-era move to reinterpret the Labor-Management Reporting & Disclosure Act (LMRDA). Organized labor had attempted to force employers to disclose expenditures relating to labor relations advice by changing rules that had been in place since 1962. If enacted, the LMRDA amendments would have made it more difficult for employers to respond to union organizing efforts.

NJBIA Offers Handbook for 2001 Federal Employment Laws and Rules
This comprehensive 600-page resource provides important information, updated for 2001, that will help you manage the tangle of federal employment laws and regulations. This powerful survival guide is perfect for small business owners, human resources managers, personnel directors, and anyone who deals with people issues in the workplace. Features include how to hire, fire and discipline employees; the difference between exempt and nonexempt employees; and much more. Prices: NJBIA members $60 (plus 6% NJ sales tax), nonmembers $90 (plus 6% NJ sales tax). Contact Dawn Miller at (609) 393-7707 ext. 224 for details.
Order Online

Central American States Seek Free Trade Agreement
A group of Central American nations is seeking a permanent free trade agreement (FTA) with the United States. They wish to lock in the benefits they currently enjoy under the Caribbean Basin Initiative. Annual US exports to the group, which include nations such as Costa Rica and Panama, exceed $12 billion. The National Association of Manufacturers reports that a Central American FTA would cover trade activity four times as large as the proposed US-Chile free trade agreement now under discussion.

A Practical Guide to NJ Employment Law:
2001-2002 Edition
NJBIA is proud to launch a valuable new publication for employers edited by Martha Lester, Esq., chair of Lowenstein Sandler's Employment Law Practice Group. This guide covers New Jersey employment-related laws, regulations, and best practices, making it an essential resource for managers and employers seeking to comply with state laws and manage workplace risks effectively. This user-friendly resource provides the law, contact information, HR tips, frequently asked questions, and forms. Act now to reserve your copy of this invaluable guide, which will be available for distribution by early summer. Prices: NJBIA members $60 (plus 6% NJ sales tax), nonmembers $90 (plus 6% NJ sales tax). To order a copy, contact Dawn Miller at 609-393-7707, ext. 224. Order Online

New US Health Dept Regulations Will Set Up Conflicting Medical-Record Privacy Rules
By April 2003, employers must comply with new regulations by the US Health & Human Services Department (HHS) covering the confidentiality of employee medical records (45 CFR Parts 160-164). While industry understands the need to preserve the privacy of individual records, businesses believe the HHS rules will unnecessarily complicate the flow of important healthcare information.

A major concern is that the HHS rules would permit conflicting privacy rules that vary state to state. Businesses prefer a uniform national standard as a way to avoid unnecessary costs. Industry groups are also alarmed by a provision that requires physicians, pharmacies and hospitals to obtain prior written consent from patients whenever individual medical information is used for treatment or payments. The fear is that routine procedures, such as processing prescriptions, will become far more costly as a result. A final concern is that employers must alter contracts with every outside "business associate" to assure that they are also complying with the privacy rules. Employers favor a regulatory approach that penalizes misuse of confidential records by any party, rather than a complicated system of oversight by employers. Industry will continue to work with HHS to develop a more balanced rule that preserves employee privacy without adding more unnecessary costs to an already expensive healthcare system.

Supreme Court Upholds Arbitration Agreements in Workplace Disputes
On March 21, the US Supreme Court declared that employers can require workers to bring workplace disputes to arbitration. The ruling in Circuit City Stores v. Adams held that arbitration agreements can be enforced in both state and federal courts.

Many employers find that resolving employment disputes through arbitration is quicker and far less costly than going to court. Interested companies should consult an experienced employment attorney. Background information on employment arbitration is available on the Web site of the American Arbitration Association (www.adr.org).

Get EEOC Help Resolving Costly Workplace Disputes
On Friday, June 15, the US Equal Employment Opportunity Commission (EEOC) will host a day-long technical assistance seminar at the Newark Airport Sheraton. The program explores how employers can respond to discrimination charges brought by the EEOC. Speakers will also discuss how employers can avoid costly disputes through up-to-date workplace policies and various settlement techniques. Topics include harassment and the Americans with Disabilities Act. Fee: $235, including lunch and a set of EEOC Technical Assistance materials. For details, call Louisa Garcia of EEOC in Philadelphia at 215-440-2625.

April Job Loss Jolts New Jersey
Employment Growth Sputters After Five Strong Years
The national economic slowdown jolted New Jersey in April, resulting in the loss of 6,900 jobs, the steepest one-month job loss in more than seven years, the New Jersey Business & Industry reported.

Most of the losses occurred in the state's private sector, which comprises 85 percent of statewide employment and includes all jobs except those in government. The losses cut across all sectors. Of the 6,800 jobs lost in the private sector, 3,800 were lost in manufacturing, 1,900 in construction, and 1,000 in the service industries, according to data released on Tuesday by the NJ Department of Labor. The data indicates that New Jersey's long employment expansion, the second longest in our post-war history, has hit a serious bump in the road. The next few months of employment data will be key, telling us whether April was just that, a bump, or the start of a more sustained employment downturn. The loss was not entirely unexpected. The nation as a whole lost nearly a quarter of a million jobs in April, the worst one-month decline in a decade. In the first four months of this year, New Jersey's private sector turned in the worst employment performance since 1992. Five thousand nine hundred jobs were lost over that period, compared with a gain of 36,900 jobs in the first four months of 2000. The last time employment lost ground in the January through April period was 1992, when 26,100 jobs were lost. These losses occurred at the tail end of the last recession, which lasted for 38 months and resulted in the loss of more than a quarter of a million private-sector jobs. This year's employment decline comes on the heels of five years of exceptional employment growth that saw the creation of close to 80,000 new jobs annually. The current employment expansion, which began in May 1992, to date has lasted for 107 months (through March 2001), although there have been brief periods, including a three-month period in 1995, in which employment has dipped.