Biden Admin Releases New Labor Rule Cracking Down On Independent Contractors – IOTW Report

Biden Admin Releases New Labor Rule Cracking Down On Independent Contractors

DC Enquirer: The Department of Labor announced Tuesday the final version of a rule that will force companies to recognize some workers as employees instead of independent contractors.

The new rule goes into effect on March 11 and rescinds a previous rule establishing independent contractors as a separate class of workers under the Fair Labor Standards Act that was put in place in January 2021 under the Trump administration, according to the DOL release. The rule could raise labor costs by up to 30% for employers who utilize independent contractors, such as app-based services like Uber or Lyft, which offer a freelancing model, as employers would have to adhere to minimum wage and overtime laws. MORE

15 Comments on Biden Admin Releases New Labor Rule Cracking Down On Independent Contractors

  1. And YET ANOTHER rung gets cut off the ladder of success. The ONLY REASON I walked into jobs after college with LOTS of work experience is because of the FREEDOM I had to work where I wanted and sometimes for WHAT I wanted, beginning when I was 12 or so. This guy is shitting all over the non-union labor market 24/7.

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  2. “So the *rule* replaces a LAW???”

    They’re learning from California.
    Every time they try and crack down on 1099 employees it back fires on them.
    And by the way, In April, California’s fast food workers get paid a mandatory $20.00 an hour. EVERY fast food chain is announcing massive lay offs and store closures. See how that work Governor Newsom. It’s simple economics.

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  3. Over the years, I have probably had as many (or more) workers ask if they could be independent contractors as employers who sought to classify people as independent contractors. These individuals receive more money, and were able to expense many items as business expenses.

    California has been cracking down on alleged mis-classification of independent contractors versus employees for years – but not because of any great concern for the workers. Employers are required to contribute to many programs for the benefit of employees such as EDD, etc., and California wants that money. There is also a control issue; the state can mandate virtually every aspect of an employee’s work life, but not so much for independent contractors. Although being an independant contractor was a little more expensive (for example, the self-employment tax is higher than the FICA deductions from an employee’s paycheck), I found the benefits of being an independent contractor outweighed the downsides.

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  4. Wyatt
    Yes. You’re exactly right. But I do believe the state new money pot is Workmans Comp. And that seems to be the big reason for the push in California. And Cali workmans comp rates are through the roof.
    And Cali could care less about it’s citizens.

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  5. Brad: don’t get me started on Worker’s Comp. I can’t tell you how many times employers have asked me to have the carrier contest a bogus claim; the short answer is that the carriers won’t do this even if fraud seems obvious. It’s a system is seemingly designed to benefit everyone (claimants, lawyers, doctors, the administrators, etc.) at the sole expense of employers. It’s an admirable idea that is all-too-frequently abused.

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  6. Wyatt
    For over 20 years I employed right at 50 people. It was a nightmare 8 years ago. We shrunk down and are capable of some pretty decent growth right now. But the wife is dead set against. Her main reason. Workmans Comp. It’s gotten much worse and much more expensive. If we decided to grow she’d want to leave the state. Which I’m fine with except where do you go?
    I could go on. A while. LOL

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