On May 1, the Department of Labor’s Wage and Hour Division (“WHD”) issued a field assistance bulletin (guidance) on determining employee and independent contractor status under the Fair Labor Standard Act (FLSA).
It advises WHD investigators to disregard the 2024 final rule and instead rely on older guidance, including Fact Sheet #13 (2008) and Opinion Letter FLSA2019-6, which addresses classification in the context of virtual marketplace platforms.
The Fact Sheet instructs that the employer-employee relationship under the FLSA follow the “economic realities” test, which considers a variety of factors, including the extent to which the services renders are an integral part of the principal’s business, the permanency of the relationships, the nature and degree of control by the principal and the degree of independent business organization and operation. The location of where the work is performed is immaterial in determining whether there is an employment relationship according to the field assistance bulletin.
The directive not to apply the 2024 Rule may make it easier to classify workers as independent contractors, particularly gig and remote workers.