Cooper Levenson Litigators Secure Appellate Win in Independent Contractor Classification Case

In a significant victory for the construction trade, the Appellate Division, in an April 20, 2021 published Opinion, found substantially in favor of Cooper Levenson client East Bay Drywall on issues relating to the classification as independent contractors of drywall installers and finishers. The matter involved a 2017 N.J. Department of Labor audit, in which the DOL determined that a substantial number of entities that had performed independent contractor work for East Bay Drywall between 2013 and 2016 were not “bona fide” independent contractors pursuant to the ABC Test. Firm partner Russell L. Lichtenstein, representing East Bay, challenged the audit and tried the matter before the Office of Administrative Law, where East Bay prevailed.

Thereafter, the Commissioner of the N.J. Department of Labor and Workforce Development rejected the Administrative Law Judge’s findings in favor of East Bay. East Bay then appealed to the Appellate Division.

In a published Opinion,(East Bay Drywall, LLC v. Department of Labor and Workforce Development, Docket No. A-2467-19), the Appellate Division concluded that East Bay had properly classified the overwhelming majority of entities performing drywall installation and finishing work as independent contractors pursuant to the ABC Test. This decision is a substantial victory for building trade contractors who hire independent subcontractors to perform work on construction job sites. The 23 page published Opinion reiterates the need for a careful factual analysis whenever the ABC Test criteria are involved. The opinion rejected, for the most part, the 2017 audit performed by the Department of Labor of East Bay’s designation of their independent contractors.

The case was initially tried before an Administrative Law Judge by Russell L. Lichtenstein, Chair of the Firm’s Labor & Employment Practice Group. Jennifer Barr, Chair of the Firm’s Research & Appeals Practice Group handled the Appellate Division briefing. Russell L. Lichtenstein argued before Judges Sabatino, Currier and Gooden Brown of the Appellate Division.

The Appellate Division Opinion can be accessed here.

Cooper Levenson is a full service law firm, originally formed in 1957. The firm has New Jersey offices in Atlantic City and Cherry Hill, as well as offices in Fort Lauderdale, Fla., New York, N.Y., Bear, Del., and Las Vegas, Nev.