On January 9, 2024, the U.S. Department of Labor (DOL) announced a , effective March 11, 2024, revising the Department鈥檚 guidance on how to analyze who is an employee or independent contractor under the Fair Labor Standards Act (FLSA). This final rule rescinds the Trump administration final rule (2021) and replaces it with a more complex analysis for determining employee or independent contractor status.
Specifically, the final rule does the following, but not limited to:
- Restores the multifactor, totality-of-the-circumstances analysis to assess whether a worker is an employee or an independent contractor under the FLSA;
- Ensures that all factors are analyzed without assigning a predetermined weight to a particular factor or set of factors;
- Uses the longstanding interpretation of the economic reality factors. These factors include opportunity for profit or loss depending on managerial skill, investments by the worker and the potential employer, the degree of permanence of the work relationship, the nature and degree of control, the extent to which the work performed is an integral part of the potential employer鈥檚 business, and the worker鈥檚 skill and initiative; and
- Rescinds the 2021 Independent Contractor Rule.
DOL also provided a set of to better understand the changes to the independent contractor standard.
黑料不打烊 previously submitted comments on the U.S. Department of Labor (DOL) Wage and Hour Division鈥檚 (WHD) proposed rule opposing the creation of this new standard for independent contractor classification and urged the DOL to withdraw the proposal. 黑料不打烊 has long called for federal clarification of the independent contractor status and preservation of legitimate independent contractor relationships, such as those that have historically existed in the construction industry. 黑料不打烊 supported the Trump administration鈥檚 rule that adopted a consistent, clear and common-sense standard for determining independent contractor status under the FLSA and filed comments opposing the DOL move to withdraw the rule.
For more information, contact Claiborne Guy at claiborne.guy@agc.org or 703-837-5382.