Biden administration seeks input on independent contractor definition

The Biden administration has started the process to formulate a new definition of independent contractors under the Fair Labor Standards Act.

The rule has been a ping-pong ball since the early days of the Biden administration. A Trump-era rule seen as more sympathetic to employers that want to define their workers as independent was tossed out by the Biden administration before it went into effect. That action was then overruled in court, and the Trump administration rule was implemented.

Even as the Biden administration pursues a new rule, it is appealing that court decision. 

But the Biden administration wants its own rule in place. The public process will begin later this week with an online employer forum from 2:30 to 4:30 p.m. EDT Friday. The Department of Labor has set up a portal for registration. 

The online session for workers is from 5 to 7 p.m EDT June 29. The registration portal for that event is different than the one for employers. 

The Department of Labor announced the forums in a blog post on the agency’s website. Jessica Looman, the acting administrator of the department’s Wage and Hour Division (WHD), was the author of the blog post. Looman is an acting administrator because the Biden administration’s earlier pick to head WHD, David Weil, was rejected by the Senate in March. He had held the role in the Obama administration. 

“For too many workers, misclassification causes lost wages, benefits, unemployment insurance and workers’ compensation coverage,” Looman wrote. “Even if they recognize that they are misclassified, many employees may be afraid to assert their employment rights because of retaliation.”

Looman said the Department of Labor is planning a formal rulemaking on a new independent contractor status definition to be used by WHD.

Labor law attorneys have said the definition is highly significant and generally sets the standard for most companies that want to avoid an action brought against it by an employee before WHD.

“We remain committed to ensuring that employees are recognized correctly when they are, in fact, employees so that they receive the protections the FLSA provides,” Looman wrote. “At the same time, we recognize the important role legitimate independent contractors play in our economy. We need to hear from workers and employers as we develop our proposal.”

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