Senate Commerce Committee Statement to Senate, No. 1503 (State of New Jersey, December 4, 2023)

Summary

This is the Senate Commerce Committee statement to Senate, No. 1503, State of New Jersey, dated December 4, 2023. The committee reports Senate Bill No. 1503 favorably and with committee amendments. As amended, the bill establishes a chair or booth rental license for individuals licensed by the New Jersey State Board of Cosmetology and Hairstyling who rent or lease a chair or booth from the owner of a licensed shop, and licenses are renewable on a biennial basis. The committee amendments include a standard to distinguish employees of a licensed shop from independent contractors working in it. As amended and reported, the bill is identical to Assembly Bill No. 1507 (2R).

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     SENATE COMMERCE COMMITTEE

                     STATEMENT TO

                   SENATE, No. 1503

 STATE OF NEW JERSEY
                    DATED: DECEMBER 4, 2023

    The Senate Commerce Committee reports favorably and with
committee amendments Senate Bill No. 1503.
    As amended, this bill establishes a new chair or booth rental
license for qualifying individuals, who already are licensed by the
New Jersey State Board of Cosmetology and Hairstyling to perform
cosmetology and hairstyling services or ancillary services, in cases
when these individuals engage in a business arrangement entered into
by a written contract whereby they rent or lease a chair or booth from
the owner of a shop that is licensed by the board. The bill specifically
provides that no licensed shop owner shall enter into a chair or booth
rental arrangement unless the practicing licensee holds a chair or booth
rental license as provided in this bill. Additionally, the bill authorizes
the board to inspect shops when chair and booth rental arrangements
exist.
    An individual applying for a chair or booth rental license shall:
make application to the board on forms as it may require; and pay a fee
as required by the board. In addition, the bill stipulates that the board
shall promulgate rules and regulations relating to the information to be
submitted for a chair or booth rental license, including information
regarding an applicant’s compliance with State and federal tax laws.
   The bill provides that the board shall maintain a record of all
individuals holding chair or booth rental licenses, which licenses shall
be renewable on a biennial basis.
    A license for a chair or booth rental is renewable on a biennial
basis. An application for renewal of a chair or booth rental license is
to require an indication if the rental license is for a chair or booth in a
mobile facility and if so, the name and shop license number of the
mobile facility. The bill also clarifies that a shop owner is not to enter
into a chair or booth rental arrangement with an individual unless that
individual holds a license to provide cosmetology and hairstyling
services for which the shop is licensed and holds a chair or booth
rental license. The individual with a chair or booth rental license
cannot provide services that are outside the scope of the services the
shop is licensed to provide.
    Moreover, an individual performing cosmetology, hairstyling, or
other ancillary services in a licensed shop shall be deemed an
employee of the shop, unless the following applies: (1) a written
agreement exists between the individual and the shop specifying the
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following: that the individual is an independent contractor; that the
shop has no right to control the methodology used by the individual to
produce a given result; and the amount of rent to be paid by the
individual to the shop, whether calculated at a fixed percentage of the
individual's gross receipts or a flat fee; (2) the individual possesses a
booth rental permit issued by the board; and (3) the individual has paid
a booth rental permit fee to the board.
    The bill also stipulates the steps to be taken by an individual when
submitting an application for a chair or booth rental, which includes
inspection of the premises where the chair or booth will be located.
Mobile facilities’ ability to allow for chair or booth rentals are also
incorporated into the bill. The bill also prohibits a licensed shop from
allowing a person to be an employ, under the shop owner’s
supervision, or be an independent contractor and practice cosmetology,
hairstyling or ancillary services who does not possess an appropriate
license issued by the New Jersey State Board of Cosmetology and
Hairstyling.
    As amended and reported by the committee, Senate Bill No. 1503
is identical to Assembly Bill No. 1507 (2R), as also amended and
reported by the committee on this date.

COMMITTEE AMENDMENTS
    The committee amended the bill to:
    (1) incorporate chair or booth rental licensure into mobile
facilities;
    (2) authorize inspections of shops with chair or booth or rentals;
    (3) create a standard to distinguish between individuals who are
employees of a licensed shop and those who are independent
contractors working in a licensed shop;
    (3) require the practicing licensee seeking a chair or booth rental
arrangement to hold both a license in the same cosmetology and
hairstyling services for which the shop is licensed to provide and a
license for a chair or booth rental;
    (4) prohibit a practicing licensee with a chair or booth rental
arrangement from offering services beyond the scope of services that a
shop or mobile facility is licensed to provide;
    (5) require an inspection of the premises prior to the issuance of a
chair or booth rental license;
    (6) add the requirement for a licensed shop that any individual who
is an employee or independent contractor working in a licensed shop
have the requisite license or registration applicable to the individual’s
position;
    (7) establish protocol for the board for the issuance of chair or
booth rental licensure; and
    (8) make technical corrections.


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