An engineering company accused of circumventing New Jersey's pay-to-play laws has furloughed 300 employees.

Wednesday's action came after a federal judge blocked Birdsall Service Group in Eatontown from making payroll and paying other expenses.

The judge is scheduled on Monday to hear the state's appeal of the company's bankruptcy filing.

Another federal judge last week ruled Birdsall could advance its bankruptcy filing despite objections raised by state prosecutors. The judge ordered a trustee be appointed to oversee the firm's $41.6 million in assets. Kaplan also said the company could use about $1 million of those assets to pay its expenses.

The Asbury Park Press reports Birdsall CEO and president Ralph Orlando issued a statement saying the company was forced to furlough the employees so they could collect unemployment.

Copyright 2013 The Associated Press.