The U.S. Department of Labor (USDOL) has rescinded its 2019 opinion letter on worker classification. In the letter (FLSA2019-6), written in response to an unnamed gig economy platform, the USDOL’s Wage and Hour Division (WHD) determined independent contractor status by considering six factors defining the relationship between employer and the worker. This follows the WHD’s delay of the effective date of a final rule containing a multifactor test for determining IC status, in accordance with the Presidential directive of January 20, 2021, instructing federal agencies to freeze pending regulatory changes for 60 days to allow the new administration time to review them. The Independent Contractor Rule, published in the Federal Register and originally set to take effect March 8, would be WHD’s first generally applicable regulation addressing who is an independent contractor and not an employee under the Fair Labor Standards Act (FLSA), and would adopt a new legal standard for determining such status. The new proposed effective date is May 7. See details of the proposed rule on the Federal Register site.
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