New York Partner Richard Reibstein, a member of Locke Lord’s Labor and Employment Practice Group, was quoted by Law360 on a New Jersey Supreme Court case addressing whether an exception to the state’s Unemployment Compensation Act covering insurance agents who work solely on commission applies to determinations of whether the agents are independent contractors under the state’s wage payment law.
If the exclusion is applicable, the state's so-called ABC test, which is much stricter than the common law test for independent contractor status, would not apply to insurance agents, he said.
"That would be favorable to the industry because the insurance companies and the insurance agents want to maintain the independent contractor relationship," he stated.
Reibstein added a Supreme Court finding that the unemployment exception applies to wage claims would raise the question of what test, if any, comes into play for those insurance agents, noting the justices' silence on that point would “leave a gaping hole” and lead to confusion in the industry.
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