Independent Contractor Final Rule issued by the department on issued on Jan. 7, 2021, for several reasons. They include the following:
The rule adopted a new “economic reality” test to determine whether a worker is an employee or an independent contractor under the FLSA.
Courts and the department have not used the new economic reality test, and FLSA text or longstanding case law does not support the test.
The rule would narrow or minimize other factors considered by courts traditionally; making the economic test less likely to establish that a worker is an employee under the FLSA.
Overtime premium pay
Among its provisions, the FLSA requires covered employers to pay employees at least the federal minimum wage for every hour worked and overtime premium pay of at least one and one-half times their regular rate of pay for every hour worked over 40 in a workweek. An independent contractor has no FLSA protections.
By John Bowden - 03/11/21 08:59 PM EST
The Labor Department moved Thursday to end two rules established under the Trump administration that reduced federal labor protections for millions of workers.
The two rules both dealt with classifications of workers as employees or independent contractors, a distinction that governs whether an employer is required to provide benefits, including health care.
In a statement, the agency said it was proposing changes to two rules instituted under the previous administration: the Independent Contractor Final Rule, passed by the agency just days before President Biden
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“The Wage and Hour Division’s mission is to protect and respect the rights of workers. Rescinding these rules would strengthen protections for workers, including the essential frontline workers who have done so much during these challenging times,” a Labor Department spokesperson said.
Labor Dept. moves to rescind two Trump-era rules on worker classification
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March 11 (UPI) The Biden administration on Thursday announced it is working to rescind two Trump-era rules it says weakened worker protections.
In the latest move by the administration of President Joe Biden to roll back the policies of his predecessor, the Labor Department said in a statement it has proposed to withdraw two rules that concern the classifications of workers and contractors under the Fair Labor Standards Act.
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The first rule called the Independent Contractor Final Rule, which was issued in the final weeks of the Donald Trump presidency, sought to clarify the standard for employee versus independent contractor while the second rule updated guidance for determining joint employer status, which was mostly vacated by the court last year deeming it violated the Administrative Procedure Act.
Friday, March 12, 2021
On March 11, 2021, the U.S. Department of Labor (DOL) issued Notices of Proposed Rulemaking (NPRMs) to withdraw the Joint Employer and Independent Contractor Final Rules published during the previous administration.
The Joint Employer Final Rule
The Joint Employer Final Rule went into effect in January 2020 and addressed the standard for determining whether an employee may be deemed to be jointly employed by two or more employers. The Rule instructed that joint employer liability is guided by four primary, albeit non-exclusive, factors derived from the decision of the U.S. Court of Appeals for the Ninth Circuit in
Bonnette v. California Health & Welfare Agency, 704 F.2d 1465 (9th Cir. 1983). Those factors are whether, and to what extent, the proposed employer (1) hires or fires the employee; (2) supervises and controls the employee’s work schedules or conditions of employment; (3) determines the employee’s rate and method of payment; and (4)
On March 2, 2021, the U.S. Department of Labor (DOL) formally delayed the effective date of the Independent Contractor Final Rule, from March 8, 2021 to May 7, 2021. The Final Rule,.