Gov. Phil Murphy signed a bill into law July 24 that protects service workers from a sudden and unexpected loss of employment due to a change in ownership.

Assembly Bill 4682/Senate Bill 2389 establishes employment protections for non-managerial/professional service employees who have been working at an eligible location on a full- or part-time basis at least 16 hours per week for 60 or more days in connection with either:

• The care or maintenance of a building or property;
• Passenger-related security services, cargo-related and ramp services, in-terminal and passenger handling, and cleaning services at an airport; or
• Food preparation services at a primary, secondary, or post-secondary school.

The law applies to locations such as multifamily residential buildings with more than 50 units, large commercial and office buildings/complexes, schools, cultural centers, industrial sites, pharmaceutical labs, airports, train stations, state courts, warehouses, and certain hospitals and nursing homes. It requires current employers to give at least 15 days’ notice of a change in property ownership by notifying bargaining representatives and posting a notification at the job site.

The employer must also share information about the service workers with the new employer, and vice versa.

New employers must retain covered service employees for at least 60 days or until the employees’ existing contract comes to an end – whichever comes first.

The exceptions include instances where the employer:

• Finds that fewer service employees are needed to perform the work than had been employed;
• Retains service employees by seniority within each job classification;
• Maintains a preferential hiring list of the employees who were not retained; and
• Hires any additional service employees from that list, in order of seniority, until all affected service workers have been offered the opportunity for employment.

Under the law, new employers cannot reduce service workers’ hours in order to circumvent these protections and cannot otherwise fire the covered employees without just cause during that 60-day period.

“Service employees should not have the rug pulled out from under them for circumstances outside their control that have nothing to do with their job performance,” said Murphy in a press release. “These protections will offer many hardworking employees the professional courtesy and stability they deserve during transitional periods.”

“Service workers should not be immediately out of a job, at no fault of their own and without warning, when a work site changes hands,” said Labor Commissioner Robert Asaro-Angelo. “With this law, New Jersey once again proves its dedication to protecting our workforce and ensuring workers are treated with the respect and dignity they deserve.”

State Sen. Troy Singleton, D-7th District, a prime bill sponsor, said that when ownership of service contracts changes, employees and their needs can often be forgotten.

“It is important to ensure that employees have job stability, even in transitions of management,” said Singleton. “We are coming off of the heels of a pandemic that catalyzed mass layoffs across the board. This law will protect employees and their jobs, easing any anxiety that may arise when ownership changes, and laying out the provisions that will be afforded to service employees.”

Opposing views

The signing of the law was applauded by 32BJ SEIU, the nation’s largest union of property service workers.

“We thank the governor for his leadership and for signing this vital piece of legislation. The Building Service Worker Retention Law gives New Jersey service workers peace of mind. This law recognizes the inherent dignity of their work and their value to the State of New Jersey,” said Kevin Brown, executive vice president and New Jersey state director, who also thanked the bill sponsors and legislative leaders. “New Jersey is now the second state in the country to protect building service employees from arbitrary layoffs during a change of building ownership or change of contractor for 60 days. Now, our state’s janitors, security officers, airport workers, concierges and other service workers will be protected from unfairly losing their jobs. This is a massive victory for workers’ rights.”

That sentiment was not shared by the New Jersey Business & Industry Association, which has long opposed the legislation, arguing that it effectively removes an employer’s right to make their own operational decisions.

“This law unfortunately imposes the most far-reaching iteration of employee retention mandates to date in New Jersey and unfortunately could result in significant health and safety implications for our residents, employees, and employers,” said Michele Siekerka, NJBIA president and CEO. “To put the situational impacts in layman’s terms, if Company A contracts with ABC Cleaning Service to clean their facility and ends that contract to hire XYZ Cleaning Service instead, the XYZ Cleaning Service will be mandated to assume ABC Cleaning Service’s employees for 60 days.”

Siekerka added that this new law will make it impractical and overly burdensome for an employer to change service contracts, stifling competition and efficiency as well as consumer health and safety.

“We believe our businesses deserve the freedom to make operational decisions for the betterment, and sometimes survival, of their business,” said Siekerka. “This law effectively takes that right away. Our businesses deserve better than lawmakers dictating how they choose to run their operations.”