In one of her first executive orders, Gov. Mikie Sherrill took a welcome step by implementing a 90-day pause on the adoption of new state rules and regulations, including the New Jersey Department of Labor’s proposed independent contractor rules. This temporary pause provides an important opportunity to reassess the scope and impact of these regulations. While the initial 90-day review is a prudent starting point, the proposed independent-contractor rules in particular warrant continued pause and careful reconsideration beyond this period to ensure they strike the right balance between worker protections and economic flexibility.

The proposed rules, as currently written, would have a devastating impact on hundreds of thousands of New Jersey workers who are considered independent contractors and the employers who rely on them. Rather than rushing forward with a regulation that would transform the very nature of freelance work, policymakers should use this pause to rethink, recalibrate, and reaffirm the rights of New Jersey’s independent workforce.

As president of Jersey1st, a grassroots organization that advocates for taxpayers and workers, I worked closely with an overwhelming number of diverse groups, individuals and businesses to strongly oppose this regulation. Frankly, the scale of grassroots resistance to this rule has been unprecedented in recent New Jersey administrative history: of roughly 9,500 written comments submitted in the rulemaking process, more than 99% were opposed. If a rule of such magnitude – one that could reshape how tens of thousands of people work – is supported by virtually no one outside the department, that alone is reason to pause and reconsider.

This isn’t disagreement coming from one niche sector. Freelancers, gig workers, small business owners, professionals, and legislators across every industry and the political spectrum have voiced serious concerns.

One of the strengths of independent work is autonomy. Gig workers choose when, how and with whom they work. Freelancers juggle multiple clients, pursue side ventures, or supplement income while caregiving or studying.

Potential consequences

The proposed rules would invert the longstanding “ABC test” used to define independent contractors, creating an employment presumption that makes it vastly harder to legally operate as a contractor in the first place.

Rather than protecting workers, the rule would strip away choice — forcing some into employment relationships they do not want, discouraging others from taking on freelance work at all, and shrinking the very diversity of economic options that keeps New Jersey competitive with other states.

Small businesses would bear disproportionate costs and complexity. Local employers, from restaurants to construction firms, depend on independent contractors to stay viable. Small business associations, including the National Federation of Independent Business, have warned that the rule would add unreasonable complexity to classification decisions and increase costs, at a time when businesses already operate on razor-thin margins.

Small business associations … have warned that the rule would add unreasonable complexity to classification decisions and increase costs, at a time when businesses already operate on razor-thin margins.

This is not a theoretical concern. Many of these businesses use contract workers precisely because they help scale operations without burdensome overhead. Pushing firms into mandatory W-2 relationships threatens jobs and could drive entrepreneurs out of the state.

A call for more scrutiny

Lawmakers on both sides of the aisle agree it deserves more scrutiny. Concern about the proposed rule is bipartisan. Nearly two dozen legislators, Democrats and Republicans, have formally called on the Department of Labor to halt the regulation and conduct a more thorough review. If elected representatives across the political spectrum share skepticism, that’s an important signal in a democracy that something isn’t working.

Executive Order No. 7 gives the Sherrill administration breathing room to align regulatory policy with the concerns of voters and lawmakers alike without the disruption of a rushed implementation.

Premature regulations could have unintended consequences for vulnerable workers. Analyses of similar approaches in states like California prove that aggressive independent contractor rules will harm, not help, the very workers they purport to protect. This includes women with caregiving responsibilities, retirees supplementing income and young people entering the workforce. Insisting on a one-size-fits-all definition of “work” risks excluding those who rely on flexibility to earn a living.

New Jersey now has one of the highest unemployment rates in the nation. Our state cannot afford to upend an entire sector of the workforce with these short-sighted regulations.

A pause is not a retreat, it’s common sense. Executive Order No. 7 does more than stall divisive rulemaking. It respects the voices of workers and businesses, honors democratic input, and preserves choices that define modern work. Instead of imposing a rigid, one-way regulatory scheme, New Jersey should engage in a thoughtful, inclusive reconsideration of how best to support both worker protections and economic freedom.

The pause should stand, and the proposed independent-contractor rule should be withdrawn in favor of sensible reforms that strengthen opportunity instead of narrowing it.

Rosemary Becchi is the president of Jersey 1st.