The Labor Department (DOL) will no longer enforce the existing independent contractor rule, DOL announced May 1. Instead, when deciding whether a worker is an employee or an independent contractor, the Wage and Hour Division will rely on Fact Sheet #13 (which originated during President George W. Bush’s term), according to Field Assistance Bulletin No. 2025-1.
The Fair Labor Standards Act’s (FLSA) minimum wage and overtime provisions apply to covered employees but not to independent contractors, so a worker’s classification has repercussions for an employer.
In 2021, the first Trump Administration published an independent contractor rule that prioritized the company’s control over the worker and the worker’s opportunity for profit or loss from the work. In 2024, the Biden Administration’s DOL rescinded the Trump rule and published a rule that makes it harder for an employer to classify a worker as an independent contractor. The Biden rule has been challenged in several lawsuits, and the Trump DOL is considering rescinding it.
Members of the Center for Workplace Compliance (CWC), our affiliated nonprofit membership association, can read more here.