DOL Changes Independent Contractor Rule

May 5, 2021

The U.S. Department of Labor (“DOL”) officially withdrew Trump-era independent contractor rules that made it easier for businesses to classify workers as independent contractors instead of employees under the federal Fair Labor Standards Act (“FLSA”).

 While this is a big change on the federal level, it does not change how workers should be classified in California.  Under AB 5, which codified the ABC Test, in order for a worker in California to be classified as an independent contract, the worker must meet all three (3) of the following factors:

  1. The worker is free from the control and direction of the hiring entity in connection with the performance of the work;

  2. The worker performs tasks that are outside the usual course of the hiring entity's business; and,

  3. The worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed for the hiring entity.

 If you are a worker who thinks that you are being wrongly classified as an independent contractor, call the attorneys at Freeburg & Granieri, APC today.

 If you are an employer who classifies its workers as independent contractors, call the attorneys at Freeburg & Granieri, APC today to make sure that you are properly classifying your workers. The liability for misclassifying workers as independent contractors can have devastating effects on your business.


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