DOL Publishes New Rule on Worker Classification

The Biden Department of Labor (DOL) has proposed a new standard for determining whether a worker is an employee or an independent contractor under the Fair Labor Standards Act. The "new" rule would restore the multi-factor, totality-of-the-circumstances approach to determining whether a worker is an employee or an independent contractor. Those factors would once again be evaluated without assigning any particular weight to any specific factor. The focus in determining independent contractor status under this rule focuses on the economic realities of the work relationship, including investment, opportunity for profit or risk of loss and whether the work is integral to the employer's business. The proposed rule also rescinds the 2021 standard that was developed under the Trump administration entirely. For more information on how workers are classified for employment law purposes, visit Tax Facts Online. : Q 8723. Note: Q is updated.