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 that allows self-employed individuals, partners in limited liability partnerships, and members of limited liability companies to be classified as employees for workers' compensation purposes if their business opts for coverage at the time of policy purchase or renewal.

Furthermore, the bill includes several important insertions and deletions to existing law. It removes the requirement that a business must have at least one employee who is not a self-employed person or partner to be required to purchase a workers' compensation policy. It also establishes that insurers and insurance producers will not be liable for damages if a business fails to elect coverage for self-employed individuals unless there is evidence of willful or gross negligence. The bill is set to take effect 180 days after enactment and will apply to all policies issued thereafter.