From JDSuipra, Lawrence Lorber, Scott Mallery, and Leon Rodriguez provide an update on several issues including the ongoing saga of the standard for classifying a worker as an independent contractor or employee under the Fair Labor Standards Act by the Department of Labor (DOL). Lawrence, Scott, and Leon write:
We have been following the DOL Independent Contractor saga since the election of Joe Biden. In a background nutshell, (1) On January 6, 2021, the DOL under President Trump finalized a new rule, making it easier for companies, including those in the “gig economy,” to classify their workers as independent contractors, rather than employees; (2) the Biden Administration, on January 20, 2022, stayed the effective date for all pending regulations, including the new IC rule, and the DOL published a notice for comment formally extending the effective date for the Independent Contractor regulation for an additional 60 days; (3) on March 11, the DOL issued a new notice of proposed rulemaking that eventually rescinded the Trump-era rule; (4) in March, a federal judge in Texas issued an order enjoining the DOL from withdrawing the Trump-era rule; and (5) the Department of Labor has appealed that ruling. Not only is the DOL appealing the decision, it has also drafted a notice of proposed rulemaking currently under review by the White House’s Office of Information and Regulatory Affairs. The White House received the proposal Tuesday, but other details about the rulemaking weren’t available — employers should expect a proposed rule more similar to California’s ABC Test and less similar to Economic Realities type test employed in the Trump-era rule.