NJ’s 1099 crackdown hits the people who can least afford it

Update: Hours after this piece published, Governor Sherrill adopted the new ABC test rules. The rule takes effect October 1, 2026. Some 1.7 million New Jersey independent contractors are now directly affected.

My wife teaches yoga. She gets a 1099 at the end of the year. I've done DJ work on the side over the years. I got a 1099 for that too.

We are not a corporation. We are not loophole hunters. We are two people doing what a lot of New Jersey families do — working a little extra, on our own terms, to make the math work in a state that never stops finding new ways to make the math harder.

And today Trenton made our situation a lot more complicated.

What this is actually about

The outgoing Murphy administration spent its final months pushing through a rule that would make it dramatically harder to work as an independent contractor in New Jersey. The rule rewrites something called the ABC test — the standard used to determine whether a worker is truly an independent contractor or should be classified as an employee.

On the surface that sounds like worker protection. It isn't.

When the state opened public comments on this rule, roughly 8,300 people responded. Only 26 — less than one percent — supported it. Truck drivers, plumbers, freelancers, small business owners, tradespeople. The people who actually live this said no, overwhelmingly, and the rule kept moving anyway.

That is New Jersey in 2026.

UPDATE: 1.7M gig workers impacted by controversial new rule change 

The 90-day pause and today's deadline

When Governor Sherrill took office in January she signed an executive order pausing the rule for 90 days to allow for review. Twenty-four members of the Legislature — from both parties — went on record opposing it. The NJBIA mobilized nearly 10,000 people to register opposition when it was first introduced.

The Governor decided.  She adopted the rule.

Who this actually affects

This is not about corporations protecting profits. It is about people who built a way of working that fits their actual life.

My wife teaches yoga classes on a schedule that works for her. She gets a check, we get a 1099, I do the taxes.  We pay them.

That flexibility is not a loophole — it is the whole point. The electrician who works for three different contractors and answers to none of them full time. The retired teacher doing tutoring on the side. The photographer shooting weddings every summer. The musician playing gigs on weekends. The mom doing freelance bookkeeping between school drop-off and pickup.

New Jersey is already one of the most expensive states in the country to live and work in. Gas is $4.42 a gallon this week. Property taxes don't need an introduction. The cost of everything keeps moving in one direction.

And Trenton made it harder to earn a living on your own terms.

Here is the part that gets me. If a business can no longer afford to hire contractors under the new rules, they do not convert them to employees with full benefits. They just stop hiring them. The work disappears. The income disappears. And the worker — the one this rule was supposedly designed to protect — is left with nothing.

What you can do

The fight isn't over. Lawmakers now have 120 days before the rule takes effect on October 1st. That window is the last chance to sort out the statutory conflicts before this dismantles gig work across New Jersey. Go to NJBIA.org and make your voice heard — not just to the Governor, but to your legislators. They have until October to get this right.

Governor Sherrill — the 1099 workers of New Jersey are not a special interest. They are yoga teachers and DJs and truck drivers and plumbers and every person trying to earn a living in a state that keeps raising the cost of doing so.

Let them work.