Concerns with S1780 - the “New Jersey Call Center Jobs Act.”
M E M O R A N D U M
TO: Members of the New Jersey Senate
Chamber of Commerce Southern New Jersey
Commerce and Industry Association of New Jersey
New Jersey Business & Industry Association
New Jersey Food Council
New Jersey Retail Merchants Association
New Jersey State Chamber of Commerce
New Jersey Utilities Association
RE: Senate Bill 1780 (Diegnan/Turner)
DATE: November 6, 2019
We are writing to express concerns with S1780 - the “New Jersey Call Center Jobs Act.” The bill requires any employer that relocates a call center, or transfers one or more facilities or operating units comprising at least 20 percent of a call center’s total operating volume to one or more foreign countries, to notify the Commissioner of Labor and Workforce Development at least 90 days prior to the relocation or transfer.
The bill also requires any employer with a call center in the State to maintain a staffing level capable of handling 65 percent of the telephone calls, emails, or other electronic communications when measured against the previous six month average volume of those operations for calls originating in New Jersey or from a New Jersey-based customer. An employer would be required to notify the Commissioner if its staffing levels fall below what is required.
The bill would further require the Commissioner to maintain and update a list of all employers required to give notice. Employers on the list would be prohibited from receiving State grants, loans, tax benefits, or other financial support for the 36 months following the date upon which the employer is added to the list.
A similar bill was recently vetoed by California Governor Gavin Newsom. “The significant penalties and restrictions proposed by this bill might dissuade businesses that have no intention of moving their operations from making any further investments in California – which could hurt, not help, California workers,” said Governor Newsom in his veto message. “The bill would also significantly restrict the state’s ability to contract with employers that conduct some of its call center operations outside of California.”
Our organizations share the same fears as Governor Newsom and have the following concerns with S1780 in its current form:
- Section 3a requires companies to comply with a faulty metric. The call centers for companies that do business in more than one state do not accept phone calls or electronic communications just from one state, but rather have a broad territory. It would be inefficient and, for some, may be nearly impossible to determine and provide for staffing to handle a percentage of calls from only one state. This also does not account for calls that are routed to call centers based upon volume, hours of operations and to provide the best customer experience.
- Therefore, we respectfully ask that section 3a be removed.
- The bill is unclear as to whether a company that does relocate a call center would be prohibited from bidding on state contracts. Penalties that impact public bidding procedures have a chilling effect overall on companies bidding for services. This reduces competition and drives up costs for state agencies looking to procure services.
- The definition of what is considered a “call center” is so broad that it could bring in other types of facilities that were never intended to be covered.
- Because of the way that the sale of tax credits occurs under the state incentive programs, this bill could have a negative impact on the ability of a company to sell those tax credits. Purchasers of tax credits may not want to assume any risks associated with the loss of potential tax credits if a call center were to be relocated during the incentive term, and therefore not purchase credits from those companies that are covered by the bill.
In closing, we thank you for your consideration of our concerns and welcome the opportunity to meet with you. You can reach our coalition by contacting Mike Wallace, New Jersey Business & Industry Association Vice President, Government Affairs at (609) 858-9506 or by email firstname.lastname@example.org.