The U.S. Department of Labor recently issued a proposed rule that could lead to more workers being classified as employees rather than independent contractors under federal wage and hour law.

The rule, which would rescind one issued in the last days of the Trump administration, is aimed at combating employee misclassification, “a serious issue that denies workers’ rights and protections under federal labor standards,” according to the DOL

Some critics argue the proposed rule creates greater confusion and provides a more restrictive approach to independent contractor classification.

“This rule makes the whole analysis much more complex and creates more ambiguity,” says G. Roger King, senior labor and employment counsel at the Virginia-based HR Policy Association, a public policy organization made up of chief human resource officers.

He thinks the proposed rule would have a substantial impact on businesses, making it harder for them to classify a labor force as independent contractors, also known as gig workers.

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The Trump-era rule lays out multiple factors to determine worker status, but places greater emphasis on two core factors: the nature and degree of control over the work (i.e. how much the employer controls the performance of work such as the worker’s schedule) and the worker's opportunity for profit or loss (i.e. can the worker decline certain jobs or ask for a higher...

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