New JerseyS3309220th Legislature (2024-2025)SenateWALLET

Establishes "Motor Vehicle Open Recall Notice and Fair Compensation Act"; revises motor vehicle franchise agreements.*

Sponsored By: Anthony M. Bucco (Republican), Craig J. Coughlin (Democratic), John DiMaio (Republican), William B. Sampson IV (Democratic), Nicholas P. Scutari (Democratic)

Signed by Governor

Personalized for You

How does this bill affect your finances?

Personalize government policy and PRIA will tell you what this bill means for your household, plus every other piece of legislation we track. PRIA reads each provision against your financial profile to show you exactly what matters to your wallet.

Free to download

Bill Overview

Analyzed Economic Effects

9 provisions identified: 7 benefits, 1 costs, 1 mixed.

Dealers gain payment and chargeback protections

Manufacturers must repay dealers for covered labor, diagnostics, and parts for warranty, extended-warranty, maintenance-plan, service-plan, and recall work. Specified duties also cover related companies and their service plans. Repair claims must be decided within 30 days and paid within 30 days after approval; incentive-program claims also have 30-day payment rules. Paid-claim audits generally reach back only 12 months unless there are reasonable grounds to suspect fraud. For specified claims, manufacturers must prove failure to make a good-faith effort to follow reasonable written procedures, unperformed work, or a materially false or fraudulent claim; paperwork errors alone are insufficient. Manufacturers must explain proposed chargebacks and audit-selection methods within 30 days after an audit, then give final notice after internal review. A dealer or representative filing a Franchise Practices Act challenge within 30 days after final notice stops the chargeback until final judgment, without a bond. These agreement rules begin on the first day of the seventh month after enactment and do not cover earlier legal claims.

Dealers gain stronger parts payment protections

Covered parts reimbursement uses the dealer's cost, including shipping, multiplied by one plus its average retail markup. Dealers can establish that markup using 100 sequential customer-paid repair orders or 90 days of orders, whichever is less, from the prior 180 days. The markup starts after 30 days, with audits limited to the sample and specified routine, wholesale, and warranty transactions excluded. Electric propulsion batteries, full engines, and full transmissions have a separate 30% reimbursement rule based on what the dealer would have paid for the part. Manufacturers cannot unfairly lower payments through parts prices or new part numbers, including covered price changes within 60 days before a recall announcement or after a recall or warranty claim arises. Manufacturers also cannot raise vehicle wholesale prices or add surcharges solely to recover covered reimbursement costs; ordinary business price increases remain allowed. These agreement rules begin on the first day of the seventh month after enactment and do not cover earlier legal claims.

Dealers get paid for recall delays

Dealers qualify for payments on recalled used vehicles held for sale if authorized to sell and service that vehicle brand. The manufacturer must issue a stop-sale or do-not-drive notice, and needed parts or service must remain unavailable for 30 days after the initial recall notice. Payments start 30 days after the stop-sale or do-not-drive notice, at least 1.5% of guide-based average trade-in value monthly, prorated. Payments end when parts or service become available or the vehicle is disposed of; required total compensation is capped at its initial average trade-in value. Manufacturers cannot cut other compensation for seeking payment, though incentive programs can be discontinued. An approved national program meeting these terms can satisfy the law, and dealers cannot combine this remedy with another state or federal recall compensation remedy.

Retail-based dealer pay with update limits

Manufacturers must pay dealers for covered labor on a retail-customer basis, including labor time. Dealers can establish retail labor rates and alternative time allowances using 100 sequential customer-paid repair orders or 90 days of orders, whichever is less. Repairs must be no more than 180 days old; the hourly rate equals total labor charges divided by total labor hours. The alternative time allowance compares billed hours with hours in the manufacturer's labor guide. Declared rates and allowances start after 30 days, and audits and proposed adjustments are limited to the submitted sample. Excluded work includes wholesale, routine maintenance unrelated to repairs, collision, tires, accessories, emissions inspections, manufacturer-approved goodwill repairs, and dealer- or employee-owned vehicles. Dealers can request changes to parts markup, labor-time allowances, or retail labor rates no more than twice per calendar year. These agreement rules begin on the first day of the seventh month after enactment and do not cover earlier legal claims.

Vehicle owners get recall repair notices

New Jersey's Motor Vehicle Commission must include recall information with vehicle registrations and renewal notices. The notice directs owners to the National Highway Traffic Safety Administration's recall database. It explains that manufacturer-approved new vehicle dealers can repair open recalls at no cost, subject to federal limits. The Commission is not liable for notice errors or omissions; manufacturers and approved dealers retain their recall repair duties. The law takes effect on the first day of the seventh month after enactment.

Certified technicians get covered repair pay

Dealers must pay factory-certified, flat-rate technicians who perform covered work after the manufacturer pays the dealer's labor claim. Covered jobs include warranty, extended-warranty, maintenance-plan, service-plan, recall, and other manufacturer-reimbursed work. The requirement applies to dealer agreements in effect on or after the law's effective date. That date is the first day of the seventh month after enactment; earlier legal claims are not covered.

Dealer groups can enforce franchise rights

Qualifying groups primarily owned by or made up of vehicle dealers can sue under the Franchise Practices Act. They can sue for themselves or for one or more dealers whose interests they primarily represent. At least one member must have an independent right to sue, and the case must fit the group's purpose. Neither the claim nor the requested remedy can require individual members to take part.

Dealers gain electric battery return protections

Manufacturers cannot impose unreasonable procedures or charges for returning or disposing of parts. Dealers cannot be penalized for returning defective electric propulsion batteries within 60 days after removal during covered manufacturer-paid work. Late-return charges cannot exceed the battery's wholesale price to the dealer. Manufacturers must provide proper battery packaging and pay dealers for packaging and return-shipping labor. These agreement rules begin on the first day of the seventh month after enactment and do not cover earlier legal claims.

Manufacturers may pay recall notice fees

New Jersey's Motor Vehicle Commission can seek federal grants and other funding for recall notices. If that funding falls short, it can charge manufacturers doing business in New Jersey. Total annual fees cannot exceed the Commission's actual implementation costs for that year. The Commission must document and publish those costs annually and provide them to affected manufacturers. The law does not directly charge households this fee.

Sponsors & Cosponsors

Cosponsors

Carmen F. Amato Jr.
Republican • Senate
Atkins, Reginald W.
Affiliation unavailable
Robert Auth
Republican • House
John V. Azzariti Jr. M.D.
Republican • House
Rosaura Bagolie
Democratic • House
David Bailey Jr.
Democratic • House
Al Barlas
Republican • House
Barranco, Christian E.
Affiliation unavailable
Jon M. Bramnick
Republican • Senate
John J. Burzichelli
Democratic • Senate
Clinton Calabrese
Democratic • House
Linda S. Carter
Democratic • House
Robert D. Clifton
Republican • House
Nilsa I. Cruz-Perez
Democratic • Senate
Joe Danielsen
Democratic • House
Christopher P. DePhillips
Republican • House
Patrick J. Diegnan Jr.
Democratic • Senate
Margie Donlon M.D.
Democratic • House
Aura K. Dunn
Republican • House
Kevin P. Egan
Democratic • House
Dawn Fantasia
Republican • House
Victoria A. Flynn
Republican • House
Vin Gopal
Democratic • Senate
Louis D. Greenwald
Democratic • House
Shama A. Haider
Democratic • House
Hall, Garnet R.
Affiliation unavailable
Owen Henry
Republican • Senate
James W. Holzapfel
Republican • Senate
Dan Hutchison
Democratic • House
Michael Inganamort
Republican • House
Paul Kanitra
Republican • House
Robert J. Karabinchak
Democratic • House
Marenco, Julio
Affiliation unavailable
Matsikoudis, Michele
Affiliation unavailable
John F. McKeon
Democratic • Senate
Angela V. McKnight
Democratic • Senate
Cody D. Miller
Democratic • House
Paul D. Moriarty
Democratic • Senate
Carol A. Murphy
Democratic • House
Mu�oz, Nancy F.
Affiliation unavailable
Gregory E. Myhre
Republican • House
Ellen J. Park
Democratic • House
Joseph Pennacchio
Republican • Senate
Luanne M. Peterpaul Esq.
Democratic • House
Eliana Pintor Marin
Democratic • House
Vincent J. Polistina
Republican • Senate
Pou, Nellie
Affiliation unavailable
Annette Quijano
Democratic • House
Ramirez, Jessica
Affiliation unavailable
Verlina Reynolds-Jackson
Democratic • House
M. Teresa Ruiz
Democratic • Senate
Brian E. Rumpf
Republican • House
Holly T. Schepisi
Republican • Senate
Alexander Schnall
Democratic • House
Heather Simmons
Democratic • House
Robert W. Singer
Republican • Senate
Troy Singleton
Democratic • Senate
Bob Smith
Democratic • Senate
Parker Space
Republican • Senate
William W. Spearman
Democratic • House
Shanique Speight
Democratic • House
Douglas J. Steinhardt
Republican • Senate
Lisa Swain
Democratic • House
Latham Tiver
Republican • Senate
Torrissi, Michael
Affiliation unavailable
Chris Tully
Democratic • House
Shirley K. Turner
Democratic • Senate
Anthony S. Verrelli
Democratic • House
Jay Webber
Republican • House
Andrew Zwicker
Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 157 • No: 0

Senate vote • 6/30/2025

CONCUR ASMB AMEND

Yes: 38 • No: 0

House vote • 6/30/2025

3RDG FINAL PASSAGE

Yes: 80 • No: 0