Can Independent Contractors Unionize in New Jersey?

If you work as a freelancer, gig worker, or independent contractor in New Jersey, you’ve probably asked yourself a tough question: can people like me join together and form a union?

The short answer is no… at least not in the traditional sense. Under both federal and state labor laws, independent contractors usually don’t have the right to unionize like employees do. But what options do they have instead?

Let’s break down how unions for contractors work, what makes someone an employee versus a contractor, and how a misclassification lawyer in New Jersey can help workers to push for better pay and fair treatment.

The Line Between Employees and Contractors

The federal law that gives workers the right to unionize is called the National Labor Relations Act (NLRA). It protects the rights of employees to join together, form a union, and bargain with their employers. But it does not cover independent contractor unionization in NJ.

That’s not an accident. Lawmakers decided decades ago that employees and contractors were different kinds of workers. Employees depend on their employers for work, pay, and direction. Contractors, on the other hand, are treated like they’re running their own businesses — and the law assumes they have more control and independence.

But not all “contractors” are truly independent. Some are labeled that way to save companies money on things like benefits, payroll taxes, and overtime. That’s called misclassification, and it’s a major issue in New Jersey.

How Do You Know If You're an Employee?

Figuring out whether you’re an employee or an independent contractor isn’t always straightforward. The law looks at a bunch of factors, not what your contract says.

At the federal level, the National Labor Relations Board (NLRB) uses a common-law test. Courts consider things like:

• Who controls your schedule and how you do your work
• Whether your work is part of the company’s main business
• If you supply your own tools or rely on the company’s equipment
• Whether you’re free to take on other clients in the same line of work
• How you’re paid: a flat project fee versus hourly wages

For example, if you perform Uber or Lyft gig work but look like a regular employee in practice, you may still be treated as one under the NLRA, even if your contract says otherwise.

This idea was reinforced in a case called The Atlanta Opera. The NLRB made it clear that the entire relationship has to be looked at, not one or two factors. That ruling opened the door for some freelancers to argue they’re actually employees, and therefore entitled to union rights, including the possibility of unions for freelancers.

New Jersey’s ABC Test For Independent Contractors

New Jersey law is even tougher on companies that misclassify workers. The state uses what’s called the ABC test, and it’s one of the strictest in the country.

The ABC test is crucial in misclassification cases, often being the first step of legal procedures. You’re presumed to be an employee unless the company can prove all three of these things:

1. A — You’re free from the company’s control when performing your work.
2. B — The work you do is outside the usual course of the company’s business.
3. C — You run your own independently established business in the same trade.

If the company fails on just one of those points, you’re an employee under New Jersey law.

This standard comes from a case called Hargrove v. Sleepy’s, where the New Jersey Supreme Court confirmed that the ABC test applies under state wage and hour laws.

That ruling gave workers more leverage to fight back when companies try to avoid paying benefits, overtime, or unemployment insurance… and reinforced that those misclassified as independent contractors may be entitled to compensation.

Big Moves in New Jersey on Misclassification

New Jersey has been especially aggressive about cracking down on misclassification in recent years.

• In 2022, Uber agreed to pay $100 million to the state over unpaid unemployment and disability contributions tied to driver misclassification.
• In 2025, the New Jersey Department of Labor proposed new rules to clarify how the ABC test should be applied. The idea is to make it harder for companies to skirt the law while still allowing real contractors — like accountants, plumbers, or graphic designers who run their own businesses — to stay independent.

Worker advocates say the changes are overdue. Business groups argue the rules could reduce flexibility for those who prefer contractor status. But wherever the debate lands, the label of gig worker or employee matters in NJ, and the state is moving toward stricter enforcement.

Signs You Might be Misclassified

Wondering where you stand? Here are some red flags that suggest you might actually be an employee:

• Your company sets your schedule and tells you exactly how to do your job.
• You perform work that is central to the company’s business.
• You don’t market yourself as a separate business or have your own client base.
• You use the company’s tools, software, or systems instead of your own.
• You’re paid like an employee — hourly, weekly, or by shift — rather than by project.

If a lot of these ring true, there’s a good chance you’re misclassified.

Options If You Want to Organize

Even if you’re labeled a contractor, there are still paths to unionization in New Jersey to build power with other workers.

1. Re-examine your classification

Start by looking closely at your work arrangement. If you think you’re misclassified, you may actually have the right to unionize under the NLRA. Keeping records of how much control the company has over your work can help if you challenge your status.

2. Worker centers and associations

Some groups form worker centers or professional associations. These don’t bargain contracts in the traditional sense, but they can:

• Provide legal support
• Educate workers about rights
• Advocate for new laws or regulations
• Pressure companies to adopt fairer policies

3. Lobby for policy changes

Workers can also push lawmakers for new protections. In fact, the growing gig economy has sparked debates in many states about creating collective bargaining rights for app-based workers, even if they’re classified as contractors.

4. Stay updated on NJ’s rule changes

The proposed 2025 regulations could shift the playing field in favor of workers. Keeping an eye on those developments is important if you’re considering organizing.

Where Does This Leave Independent Contractors in New Jersey?

Here’s the reality:

• True independent contractors — people who run their own businesses, set their own rates, and work for multiple clients — generally cannot unionize in New Jersey. They also have to be careful about collective rate-setting because of antitrust laws.
• Misclassified workers — those treated like contractors on paper but employees in practice — may actually have the right to organize. Both federal law and New Jersey’s ABC test offer ways to challenge misclassification.

The label your company gives you doesn’t decide your rights: the facts of your working relationship do.

Your Work Deserves Fair Pay

If you’re working as an independent contractor in New Jersey, the question of whether you can unionize depends on whether you’re really a contractor in the eyes of the law. Some are — but many are not.

Understanding your rights is the first step toward deciding whether to challenge your classification, join with others, or push for broader changes in how contractors are treated.

Have Questions About Union Options? Contact Us For Your Free Consultation

If you’re unsure about your status or whether you and your coworkers have the right to organize, don’t guess. 

Contact us for legal advice and a free consultation. We’ll help you review your situation, explain your options, and guide you toward the best path forward.