CCSNJ Opposes Bill That Would Tighten Business License Revocation Laws
Monday, June 15, 2009

M E M O R A N D U M

TO: Members of the Senate Labor Committee

FROM: Christina M. Genovese, Manager, Government Relations, CCSNJ

RE: S-2773 (Sweeney/Madden)

DATE: June 15, 2009

The Chamber of Commerce Southern New Jersey respectfully opposes S-2773 (Sweeney/Madden), which concerns suspension and revocation of employer licenses for repeated violations of wage, benefit, and tax laws.

S-2773 (Sweeney/Madden) provides that if the Commissioner of the Department of Labor and Workforce Development determines that an employer has knowingly failed to maintain and report all records required by law regarding wages, benefits and taxes and, as a result, has failed to pay employees what they are afforded by law, the Commissioner can suspend an employer’s license to conduct business.

Once a license is suspended, the Commissioner is required to conduct an audit on the employer in question. During the audit process, if the Commissioner determines that the employer has failed to meet reporting standards and continued to knowingly fail to pay required wages, benefits or taxes, the Commissioner will have the authority to permanently revoke any licenses held by the employer.

Although the Chamber does not advocate that employers be able to evade their legal obligation when compensating employees, we believe that it is redundant to adopt a law that provides penalties for violations of law where the underlying laws already have penalty provisions and, in some of those cases, impose individual liability on managing officers and directors. Pursuing such legislation is counterproductive to making New Jersey a friendlier state to do business and sends a poor message to future and current business owners choosing to call this State home.

Additionally, the Chamber believes that the Commissioner should not have the power to rescind an employer’s right to do business in New Jersey, especially if this will be done administratively as opposed to through a court of law. Although the employer can appeal a decision, this process is a very limited review and may not give the employer a fair opportunity to present its case.

The Chamber strongly believes that the license revocation allowed in this bill will result in the loss of jobs, increased unemployment, a lower tax base, and a lack of entrepreneurial businesses at a time when New Jersey should be encouraging the opposite. For these reason, we ask you to please oppose S-2773 (Sweeney/Madden).