Trump Administration Proposes To Rescind And Replace Biden-Era Independent Contractor Rule

As Supply Chain Dive reported, the U.S. Department of Labor (DOL) has launched a regulatory process that, if finalized, would rescind the Biden administration’s 2024 independent contractor rule. In its Federal Register notice, which is available at this link, the DOL’s Wage and Hour Division said it would like to return to an “economic reality test” for determining whether a worker is an independent contractor under the Fair Labor Standards Act (FLSA). The economic reality test was previously adopted in 2021 during President Donald Trump’s first term.

The Biden administration had implemented a “totality-of-the-circumstances” framework to determine whether a worker was an independent contractor or an employee. Additionally, DOL proposed to use that analysis in implementing the Family and Medical Leave Act and the Migrant and Seasonal Agricultural Worker Protection Act.

The public has 60 days, until April 28, to comment on the proposed rule.

“The rule we are proposing today is not only based on long-standing legal principles used in federal courts across the country but also is aimed at ensuring that workers and employers know how to apply those principles predictably,” said Wage and Hour Division Administrator Andrew Rogers. “The department believes that streamlined regulations in line with Congress’s intent when it passed the Fair Labor Standards Act would improve compliance, reduce misclassification, and reduce costly litigation in an economic environment that needs flexibility and innovation.”

Read DOL’s full explanation of its proposed rule at this link.