New Rule to Determine Independent Contractor Status Now in Effect

The Department of Labor (DOL)’s Final Rule governing the standard for determining independent contractor status under the Fair Labor Standards Act (FLSA) became effective March 11, 2024. The Final Rule establishes a six-factor economic realities worker classification test and rescinds a narrower rule issued in 2021. The multifactor test uses a totality-of-the-circumstances analysis to determine whether a worker is an employee who is economically dependent on the employer for work or an independent contractor who is in business for themself. For more information, read this SEK article.