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Department of Labor Plans Revision of its Independent Contractor Interpretation

October 7, 2020

The U.S. Department of Labor, Wage and Hour Division, published a Notice of proposed rulemaking and request for comments regarding the revision of its interpretation of independent contractor status under the Fair Labor Standards Act (FLSA).

According to the Department of Labor, the purpose of the revision is “to promote certainty for stakeholders, reduce litigation, and encourage innovation in the economy.”

The FLSA requires employers to pay covered employees the federal minimum wage for every hour worked, overtime pay for every hour worked over 40 in a workweek, and maintain employment records. Someone who works for a company as an independent contractor is not subject to the FLSA.

The Department of Labor proposes creating a new section in the Code of Federal Regulations, “setting forth its interpretation of the FLSA as relevant to the question whether workers are ‘employees’ or are independent contractors under the Act.” According to the notice, “The proposed regulations would adopt general interpretations to which courts and the Department have long adhered.”

Comments are due no later than October 26, 2020. This is a link to the notice;