Trenton, NJ – Gov. Phil Murphy on Thursday signed into law the “Motor Vehicle Open Recall Notice and Fair Compensation Act,” a measure that New Jersey’s auto dealers say marks a turning point in how recalls and warranty work are handled across the state.
The legislation, S3309/A4380, ensures that automakers must fairly compensate dealerships and their technicians for performing recall and warranty repairs, while also strengthening consumer protections around vehicle safety. The law takes effect April 1, 2026.
“This legislation represents a critical step forward in protecting consumers, leveling the playing field for locally owned dealerships, and ensuring that automakers fairly compensate those who fix their mistakes,” said Laura Perrotta, president of the New Jersey Coalition of Automotive Retailers (NJ CAR), which lobbied heavily for the bill.
Among its key provisions, the new law requires manufacturers to pay dealers at retail rates for warranty and recall work, mandates compensation for dealers holding unsellable recalled vehicles, expands outreach to consumers with open recalls, and prevents automakers from shifting recall-related costs onto dealers or customers.
It also protects dealerships from retaliation when filing reimbursement claims and grants NJ CAR and other associations standing to take legal action against violations.
NJ CAR Chairman Ronald Baus, Jr. said the law brings New Jersey’s protections in line with neighboring states and will “ensure that family-owned and operated businesses like ours, as well as all dealerships across the State, will be fairly compensated while keeping drivers safe on the road.”
The measure received backing from organized labor groups, including the NJ AFL-CIO, the NJ State Council of Machinists and the United Service Workers Union, which argued that dealership technicians deserved fair pay for recall-related work.
Key Points
- Gov. Phil Murphy signed the “Motor Vehicle Open Recall Notice and Fair Compensation Act” into law.
- The law forces automakers to pay dealers retail rates for warranty and recall work and expands consumer recall protections.
- It takes effect April 1, 2026, with support from labor unions and dealer associations.
The law puts auto safety and dealer fairness in the fast lane across New Jersey.
