This bill amends the New Jersey workers' compensation law to clarify the definition of "employee" and the requirements for workers' compensation insurance for certain business structures, particularly S corporations. It specifies that an individual who is the sole performer of services and the only shareholder in an S corporation will not automatically be considered an "employee" for the purposes of receiving benefits and paying premiums unless the corporation elects to obtain coverage for that individual. Additionally, the bill introduces a provision stating that a business, limited liability partnership, limited liability company, or partnership is not required to purchase a workers' compensation policy unless it has at least one employee who is not a self-employed person or partner actively performing services.

The bill also includes new language regarding the responsibilities of insurers and insurance producers, stating they will not be liable for damages if a business fails to elect coverage for self-employed individuals unless there is willful or gross negligence involved. Furthermore, it mandates that applications for workers' compensation coverage include notices about the availability of coverage for self-employed individuals and the implications of not electing such coverage. The act will take effect 180 days after enactment and will apply to all policies issued thereafter.