On January 9th, the U.S. Department of Labor announced the issuance of a final rule that revises the federal framework for determining whether a worker is an employee or an independent contractor. This rule rescinds a previously issued 2021 Independent Contractor rule and, among other changes, restores a “totality-of-the-circumstances” analysis to determining whether a worker is economically dependent upon an employer for work, versus being in business for themselves, under the Fair Labor Standards Act (FLSA). This standard is important because the FLSA’s minimum wage and overtime pay protections do not apply to independent contractors, and many observers expect the new rule to result in more individuals being classified as employees than is the case under the 2021 rule. The Department has posted a Frequently Asked Questions resource to summarize certain key issues. LeadingAge will provide additional analysis in the coming days.
