The U.S. Department of Labor (DOL) Wage and Hour Division (WHD) finalized its recent proposal to officially withdraw a Trump administration final rule clarifying the standard for employee versus independent contractor status under the Fair Labor Standards Act (FLSA). The previous final rule originally was to be effective on March 8, 2021. However, a recent proposal delayed that date to allow the agency “the opportunity to review and consider the questions of law, policy, and fact raised by the rule[s].” The withdrawal is effective immediately without any replacement or new guidance and employers are advised to rely on past court decisions and WHD guidance to determine whether those workers are employees under the FLSA or independent contractors.
AGC has long called for federal clarification of the independent contractor status and preservation of legitimate independent contractor relationships, such as those that have historically existed in the construction industry. AGC supported the Trump administration’s rule that adopted a consistent, clear and common-sense standard for determining independent contractor status under the FLSA and filed comments opposing the DOL move to withdraw the rule. AGC will keep members apprised of any new developments and fully expects to participate in any future revision or adoption of guidance regarding the independent contractor status.
For more information, contact Claiborne Guy at claiborne.guy@agc.org or 703-837-5382.