WASHINGTON – The U.S. Department of Labor’s Wage and Hour Division today announced a proposed rule designed to help workers and employers better understand how to determine when a worker is an employee and when the worker may be classified as an independent contractor under the Fair Labor Standards Act and related federal laws.
The proposed rule would rescind the department’s 2024 final rule addressing the classification of independent contractors and replace it with an analysis for employee classification similar to the one adopted by the department in 2021. Consistent with Supreme Court and federal circuit court precedent, the proposed rule would make it easier to properly differentiate between employees with the protections under the Fair Labor Standards Act and those workers who work as independent contractors.
“The tens of millions of Americans who work as independent contractors are helping drive the Golden Age of the American economy,” said Secretary of Labor Lori Chavez-DeRemer. “The department’s proposed rule seeks to protect these workers’ entrepreneurial spirit and simplify compliance for American job creators navigating a modern workplace, all while maintaining robust protections for employees under the Fair Labor Standards Act.”
The proposed rule would also apply the department’s streamlined analysis to the Family and Medical Leave Act and the Migrant and Seasonal Agricultural Worker Protection Act, both of which use the FLSA’s statutory definition of “employ....
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