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DOL/WHD RIN: 1235-AA34 Publication ID: Fall 2020 
Title: Independent Contractor Status Under the Fair Labor Standards Act 
Abstract:

The Department of Labor is proposing a regulation for determining independent contractor status under the Fair Labor Standards Act.

 
Agency: Department of Labor(DOL)  Priority: Economically Significant 
RIN Status: Previously published in the Unified Agenda Agenda Stage of Rulemaking: Final Rule Stage 
Major: Yes  Unfunded Mandates: No 
EO 13771 Designation: Deregulatory 
CFR Citation: Not Yet Determined     (To search for a specific CFR, visit the Code of Federal Regulations.)
Legal Authority: Fair Labor Standards Act, 29 U.S.C. 201 et seq.   
Legal Deadline:  None

Statement of Need:

The Department believes that the multifactor economic reality test presently used in determining independent contractor status would benefit from additional clarity because of the way courts have evolved from the text and Supreme Court precedent.  The existing test assesses workers’ economic dependence on a potential employer and, as often articulated by courts and the Department, raises the following concerns: (1) the core concept of economic dependence remains vague and under-developed; (2) the test lacks guidance about how to balance the multiple factors; and (3) the lines between many of the factors are blurred.  These shortcomings have become more apparent in the modern economy.

Summary of the Legal Basis:

The proposed regulation would be authorized by the Fair Labor Standards Act, 29 U.S.C. 201-219; Reorganization Plan No. 6 of 1950; and Secretary’s Order 01-2014 (December 19, 2014), 79 FR 77527. The proposed regulation would constitute the official interpretation of the Department with respect to independent contractor status under the Act.

Alternatives:

The Department will examine regulatory alternatives as part of the NPRM.

 

Anticipated Costs and Benefits:

The Department will prepare estimates of the anticipated costs and benefits associated with the proposed rule.

Risks:

This action does not affect public health, safety, or the environment.

Timetable:
Action Date FR Cite
NPRM  09/25/2020  85 FR 60600   
NPRM Comment Period End  10/26/2020 
Final Rule  12/00/2020 
Regulatory Flexibility Analysis Required: Yes  Government Levels Affected: Local, State 
Small Entities Affected: Businesses, Organizations  Federalism: No 
Included in the Regulatory Plan: Yes 
RIN Data Printed in the FR: Yes 
Agency Contact:
Amy DeBisschop
Director of the Division of Regulations, Legislation and Interpretation
Department of Labor
Wage and Hour Division
200 Constitution Avenue NW, FP Building, Room S-3502,
Washington, DC 20210
Phone:202 693-0406