New Jersey: employee or independent contractor?
The test depends on which law you're dealing with. A worker can be a contractor for one law and an employee for another.
| Law | Test | Statute |
|---|---|---|
| Unemployment insurance | ABC | N.J.S.A. 43:21-19(i)(6); N.J.A.C. 12:11 |
| Wage and hour / wage payment | ABC (same UI test, per Hargrove v. Sleepy's, 2015, and N.J.A.C. 12:11) | N.J.S.A. 34:11-4.1 et seq. (Wage Payment Law); N.J.S.A. 34:11-56a et seq. (Wage and Hour Law); N.J.A.C. 12:11 |
| Federal income tax, FICA, FUTA | IRS common-law test | IRS |
| Federal minimum wage and overtime | Economic reality test (FLSA) | DOL |
The ABC test
Under New Jersey's unemployment law, a worker is an employee unless all three parts are met:
(A) free from control or direction over the performance of such service, both under his or her contract of service and in fact; (B) such service is either outside the usual course of the business for which such service is performed, or performed outside of all the places of business of the enterprise; (C) customarily engaged in an independently established trade, occupation, profession or business.
Recent change
NJDOL ABC-test rules, N.J.A.C. 12:11 (58 N.J.R. 1587(a), R.2026 d.073): effective June 1, 2026, operative October 1, 2026. They codify how NJDOL applies the ABC test under the UI, wage-payment, wage-and-hour and other NJ laws; the statutory test is unchanged.
Details and exceptions
- Rule effective date June 1, 2026; operative date October 1, 2026 (current.effective_date uses the operative date).
- The putative employer must prove all three prongs.
- Workers' comp test not checked in this pass (Business insurance lane).
Law: N.J.S.A. 43:21-19(i)(6); N.J.A.C. 12:11
Running payroll in New Jersey?
Recent changes
Last verified against the official source on October 9, 2026.
No changes recorded since we started tracking this page.
Sources
- New Jersey Department of Labor and Workforce Development · data as of October 8, 2026 · last checked October 9, 2026
We copy figures from official sources and re-check them against the source before every update. See our methodology. This is general information, not legal advice.