The North Dakota Employer’s Blog: The U.S. Department of Labor Makes Announcement on the Independent Contractor Rule

by | May 5, 2021 | Employer Rights, Employment Law, The North Dakota Employer's Blog

The North Dakota Employer's Blog

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The U.S. Department of Labor announced today that it is withdrawing the “Independent Contractor Status Under the Fair Labor Standards Act” (FLSA) final rule issued under the previous administration on January 6, 2021. As anticipated, the new administration re-examined the previous rule and has withdrawn it after receiving approximately 1,000 comments in response. The rule would have made it easier for businesses to classify workers as independent contractors rather than employees by looking primarily at only two “core factors”—the nature and degree of control over the work and the worker’s opportunity for profit or loss. However, for now, there is no new rule, and it remains to be seen when or whether the Department will issue any alternative rule on this issue. Therefore, the traditional analysis of looking at a number of factors under “the totality of the circumstances” related to the employment relationship remains in place. Employers should also keep in mind that states may vary on the definition or factors involved to determine the employment relationship. Stay tuned for more announcements from the Vogel Law Firm employment law team in the event the administration releases a new independent contractor rule in the future.