New Jersey Law Will Require Uber and Lyft Drivers to Undergo Driving and Criminal Background Checks

Written By ESR News Blog Editor Thomas Ahearn

New Jersey Governor Chris Christie has signed into law new legislation – the “Transportation Network Company Safety and Regulatory Act” (A3695) – that will license and regulate transportation network companies (TNCs) such as Uber and Lyft and require them to meet insurance coverage standards and conduct driving and criminal background checks on drivers. The law takes effect on May 1, 2017.

The new law will require TNC ride-hailing services such as Uber and Lyft to maintain $1.5 million in commercial auto insurance on drivers. While TNCs are permitted to conduct their own background checks on drivers, the Attorney General must approve the method that the TNC, or a third party screening company designated by the TNC, proposes to use to conduct criminal background checks.

The Attorney General shall not approve criminal background checks conducted by a TNC, or a third party screener designated by the TNC, unless the check includes a search of: (1) a multi-state and multi-jurisdictional criminal records locator or other similar commercial nationwide database with validation; (2) the United States Department of Justice’s Dru Sjodin National Sex Offender Public Website.

Applicants shall be prohibited from being TNC drivers if they had been convicted of one or more crime including homicide, sexual assault, driving under the influence of drugs or alcohol, reckless driving, and possession or sale of a controlled dangerous substance. TNC drivers must also have a valid basic driver’s license, vehicle registration, and automobile liability insurance for their vehicles, and be at least 21-years-old.

TNC drivers could become subject to background checks by state police if the state Attorney General’s office does not approve the TNC’s measures are insufficient.  In addition, the TNC shall pay an initial and annual permit fee of $25,000. A copy of the “Transportation Network Company Safety and Regulatory Act” (A3695) law is available at http://www.njleg.state.nj.us/2016/Bills/A4000/3695_R1a.PDF.

Background Checks for On Demand Workers in Gig Economy

The fast growing “gig economy” that focuses on temporary work – or “gigs” – provided by companies such as Uber and Lyft accounted for 30 percent of new jobs and created new income sources for 2.1 million people in the United States between 2010 and 2014. The “on demand” workforce is expected to grow from 36 percent of the U.S. workforce now to reach 43 percent – or 76 million people – by 2020.

Employment Screening Resources® (ESR) predicts that employers will need to strengthen background checks for the growing on-demand workforce in America and that trend is one of the ‘ESR Top Ten Background Check Trends for 2017’ selected by ESR founder and CEO Attorney Lester Rosen. The complete list of trends is available at www.esrcheck.com/ESR-Top-Ten-Background-Check-Trends.

NOTE: Employment Screening Resources® (ESR) does not provide or offer legal services or legal advice of any kind or nature. Any information on this website is for educational purposes only.

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