DOL Final Independent Contractor Rules And Benefit Plans

DEPARTMENT OF LABOR'S FINAL INDEPENDENT CONTRACTOR RULE CONTAINS IMPORTANT POTENTIAL IMPACTS FOR EMPLOYEE BENEFIT PLANS

Final Department of Labor Independent Contractor Rule

On January 10, 2024, the Department of Labor (DOL) published a final rule (the Final Rule) regarding independent contractors under the Fair Labor Standards Act (FLSA). The prior rule, which was issued by the DOL in January 2021 and faced a variety of litigation and administrative hurdles, used five "economic reality factors" to determine whether an employee is an independent contractor and considered two of these five factors—the nature and degree of control over the work and the worker's opportunity for profit or loss—as the "core factors" for determining whether an individual is an independent contractor.