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DOL Extends Comment Period for Proposed New Rule Regarding Independent Contractor Status

On October 25, 2022, the Department of Labor extended the comment period for its new proposed rule regarding independent contractor status under the Fair Labor Standards Act. While the comment period was originally set to expire on November 28, 2022, interested parties will now have until December 13, 2022 to submit comments.

As we have previously discussed, the proposed new rule will, if finalized, rescind and replace the 2021 rule’s “economic reality” test with a return to the “totality of the circumstances” standard to determine whether or not employees are correctly classified as employees or independent contractors. The DOL’s new rule identified six economic factors one should consider in determining how to classify workers: (1) opportunity for profit or loss depending on managerial skill, (2) investments by the worker and the employer, (3) degree of permanence of the work relationship, (4) nature and degree of control, (5) extent to which the work performed is an integral part of the employer’s business, and (6) skill and initiative of the workers. The DOL added that the list is non-exhaustive and that there may be additional factors.