The Department of Labor (DOL) has indicated that it would be changing its enforcement stance on the classification of independent contractors under the Fair Labor Standards Act (FLSA) in 2025, which might make it simpler for companies to designate employees as contractors. The DOL will now use a more conventional "economic reality" test to determine worker status in lieu of implementing the 2024 independent contractor rule. At the federal level, this change might result in more companies designating employees as independent contractors.
The standard "economic reality" test, which takes into account a number of variables such as the employer's level of control, the longevity of the connection, and the worker's chances for profit or loss, will be used by the DOL in place of the 2024 regulation.
The DOL will use the previous "economic realities" standard, as outlined in Fact Sheet #13 (2008) and Opinion Letter FLSA2019-6, in lieu of the 2024 Rule. This concept focuses on whether the person is working for themselves (and therefore an independent contractor) or is financially dependent on the employer (and thus an employee).
Why you should attend this:
Due to the DOL's decision to halt the 2024 Rule's implementation, WHD investigators will assess independent contractor status under the FLSA using the more well-known and expansive "economic reality" criteria that the DOL has employed for many years, which is generally thought to be more employer-friendly. Employers should continue to closely examine how employees really perform their jobs, not only how they are described in contracts, job descriptions, or titles, even while no new legal obligations are being placed on them. The DOL WHD is not implementing the 2024 Rule, even though it is still in effect in theory. While awaiting the resolution of ongoing lawsuits and taking into consideration any rule changes, the DOL is currently reverting to its traditional view of employee vs. independent contractor status under the FLSA.
Areas covered in the session:
Who should attend this:
Margie Faulk is a senior-level human resources professional with over 18 years of workplace compliance experience and HR consulting experience. A current Compliance Advisor for HR Compliance Solutions, LLC. Margie has worked as an HR Compliance advisor for major corporations and small businesses in the small, large, private, public, and Non-profit sectors. Margie’s new focus is to provide Employers and Professionals with risk management strategies to develop risk management strategies to mitigate workplace violations.
Margie has provided small to large businesses with risk management strategies that protect companies and reduce potential workplace fines and penalties from violations of employment regulations. Margie is bilingual (Spanish) fluent and Bi-cultural. Margie holds professional human resources certification (PHR) from the HR Certification Institution (HRCI) and SHRM-CP certification from the Society for Human Resources Management. Margie is a member of the Society of Corporate Compliance & Ethics (SCCE). Margie is also a SHRM Credit Provider offering SHRM-CP and SHRM-SPC credits for her training which major HR individuals need to maintain their certification credits.
