Bill
S 4004
Modernizes the Sheltered Workshop Act into the Extended Employment Act, expanding employment opportunities for people with disabilities and enabling hybrid work up to 16 hours week
Status and Procedural History
- Introduced: January 14, 2025 (Senate Labor Committee)
- Reported with committee amendments: June 5, 2025
- Referred to: Senate Budget & Appropriations; later referred to Judiciary
- Primary sponsor: Kevin S. Parker
- Companion: A5131
Purpose / Intent
- Modernizes and retitles the Sheltered Workshop Act of 1971 as the "Extended Employment Act."
- Reframes State policy to emphasize workforce development, rehabilitation, and movement toward competitive integrated employment for people with disabilities.
Key Provisions and Changes
- Terminology and eligibility
- Replaces the terms “sheltered workshop” and “sheltered employee” with “extended employment” and “extended employee.”
- Lowers eligibility threshold wording from “severe” disability to “significant” disability and removes prior requirements that participants complete a workshop program or be deemed incapable of competing in the regular labor market.
- Defines “extended employment” broadly as workforce development and employment opportunities delivered by nonprofit providers in a variety of worksite settings.
- Administration and oversight
- Shifts primary program administration and eligibility determination to the Division of Vocational Rehabilitation Services (DVR) in the Department of Labor and Workforce Development.
- Eliminates the New Jersey Commission for the Blind and Visually Impaired’s statutory role in eligibility, standards, and documentation for these programs.
- Requires consultation with ACCSES New Jersey and the New Jersey Council on Developmental Disabilities on major DVR policy and leadership changes affecting the program (committee amendment added the Council).
- Funding and reporting
- Establishes a baseline funding level equal to the FY 2024 State Budget level for vocational rehabilitation and requires annual increases equal to the greater of: (a) CPI‑W (consumer price index for urban wage earners and clerical workers) growth, or (b) 80% of providers’ collective functional expense amounts submitted annually.
- Directs increased appropriations to come from the Workforce Development Partnership Fund when available.
- Requires providers to submit an annual functional expense analysis and clarifies annual reporting requirements (committee amendment).
- Program design and provider requirements
- Clarifies desired outcomes (e.g., pathway to competitive employment, higher wages/hours, job variety, life skills).
- Requires extended employment providers to be nonprofit and accredited by a nationally recognized accrediting body.
- Requires that the provider’s primary responsibility is to serve the extended employees they enroll (committee amendment).
- Creates a "hybrid employment" process allowing extended employees to seek regular employment up to 16 hours per week without losing eligibility.
- Statutory repeals and eliminations
- Repeals provisions of P.L.1975, c.350 regarding sale and labeling of products produced in extended employment facilities (including labeling, minimum on-site work percentages, and related penalties).
- Removes previously granted exemptions for extended employment facilities under the industrial homework law and eliminates references to specific transportation types in program assistance provisions.
Who Is Affected
- People with disabilities who participate in extended employment programs (expanded eligibility language and hybrid work options).
- Nonprofit extended employment providers (new accreditation, reporting, funding, and program responsibilities).
- Division of Vocational Rehabilitation Services and the Department of Labor and Workforce Development (administration, contracting, and consultation duties).
- The New Jersey Commission for the Blind and Visually Impaired (statutory role reduced/eliminated).
- State budget and Workforce Development Partnership Fund (new baseline and indexed funding obligations).
Fiscal Impact (per Office of Legislative Services)
- Annual State expenditure increase: Indeterminate.
- The bill sets a funding baseline and a formula for annual growth (CPI‑W or 80% of reported provider expenses), which could drive increased appropriations. OLS provides an illustrative example: at a $41.9 million FY 2024 base and a 2.9% CPI‑W growth, annual increase ≈ $1.2 million. Actual costs depend on future appropriations and provider expense reports.
- Repeal of some regulatory/labeling requirements may yield a small, indeterminate administrative savings.
Committee Amendments (notable)
- Add New Jersey Council on Developmental Disabilities as a consultation partner.
- Clarify annual reporting requirements.
- Require that providers’ primary responsibility is serving extended employees.
- Establish a hybrid employment process (up to 16 hours/week) where participants may pursue regular employment without losing extended employment status.
Compiled from official sources — confirm details with the bill’s official record.
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