DOL Withdraws Independent Contractor Rule
The Department of Labor (DOL) Wage and Hour Division has withdrawn the independent contractor rule that was scheduled to take effect on May 7, 2021. The rule had previously been delayed from its original effective date of March 7, 2021. The rule’s intended purpose, as described by the DOL, was to clarify distinctions between employee and independent contractor status under the Fair Labor Standards Act (FLSA).
After having delayed the effective date, on March 12, 2021, the DOL published a proposal to withdraw the rule and requested comment. The DOL stated that it received over 1,000 comments supporting the withdrawal and numerous comments opposing the withdrawal. Upon review of the comments, the DOL finalized the withdrawal of the rule, stating that “the Rule is inconsistent with the FLSA’s text and purpose, and would have a confusing and disruptive effect on workers and businesses alike due to its departure from longstanding judicial precedent.”
