Sponsored by:
Senator JOSEPH A. LAGANA
District 38 (Bergen)
Senator JOSEPH PENNACCHIO
District 26 (Morris and Passaic)
SYNOPSIS
Clarifies current law addressing commissions paid to limited liability companies formed by real estate salespersons or broker-salespersons.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning compensation for certain broker-salespersons and salespersons and amending R.S.45:15-16.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. R.S.45:15-16 is amended to read as follows:
45:15-16. a. No real estate salesperson or broker-salesperson shall accept a commission or valuable consideration for the performance of any of the acts herein specified, from any person except his employer or contracting broker, who must be a licensed real estate broker.
b. [A] Notwithstanding any provision of R.S.45:15-1 through R.S.45:15-29.5, or any other law, rule, or regulation to the contrary, a real estate salesperson or broker-salesperson may form a limited liability company pursuant to the "Revised Uniform Limited Liability Company Act," P.L.2012, c.50 (C.42:2C-1 et seq.), or any other entity permitted by law, in order to receive a commission or other valuable consideration pursuant to subsection a. of this section, and the real estate salesperson or broker-salesperson may accept payment of the commission or other valuable consideration or any part thereof from the limited liability [corporation] company or other entity without affecting the business affiliation between the employing or contracting broker and salesperson or broker-salesperson defined in the written agreement between the employing or contracting broker and the salesperson or broker-salesperson as provided in subsection b. of P.L.2018, c.71 (C.45:15-3.2). [Notwithstanding the formation of such an entity, a salesperson or broker-salesperson who satisfies the requirements of subparagraph (K) of paragraph (7) of subsection (i) of R.S.43:21-19 shall not be considered an employee pursuant to that law.]
c. The New Jersey Real Estate Commission shall create a registration process for a limited liability company and other entity to receive a commission or other valuable consideration pursuant to [subsection] subsections a. and b. of this section.
(cf: P.L.2021, c.281, s.1)
2. This act shall take effect immediately.
STATEMENT
This bill updates New Jersey law addressing the compensation of a real estate salesperson or broker-salesperson who has created a limited liability company pursuant to State law. Currently, no real estate salesperson or broker-salesperson can accept a commission or valuable consideration from any person except the employer or licensed broker with whom the salesperson or broker-salesperson is under contract. The bill clarifies that a real estate salesperson or broker-salesperson may accept the commission or other valuable consideration from the limited liability company or other entity without affecting the business affiliation between a broker and salesperson or broker-salesperson defined in the written agreement between the broker and salesperson or broker-salesperson.