DOL Independent Contractor Proposed Rule Misses the Mark
The Rule Fails to Address Emerging Needs of Workers and Employers for Greater Flexibility
WASHINGTON, D.C. – HR Policy Association, representing chief human resource officers of more than 400 of the largest employers in the United States, expresses disappointment in the Department of Labor’s recently issued proposed rule on independent contractor status under the Fair Labor Standards Act.
Collectively, HR Policy Association member companies employ more than 11 million employees in the United States, over nine percent of the private sector workforce. Since its founding, one of the Association’s principal missions has been to ensure that laws and policies affecting human resources are sound, practical, and responsive to labor and employment issues arising in the workplace.
While the Association understands the need for greater clarity as to the relationships between employers and workers in the workplace, the Department’s proposed rule will, in practice, only further complicate an already opaque area of law. The proposed rule is a missed opportunity to address the evolving needs of current and future workers and employers, and to meaningfully provide protections for gig and platform workers without inhibiting desired flexibility.
The proposed rule is unfortunately instead a regressive approach to a nuanced and complex issue. Rather than work with stakeholders from both the worker and employer community to craft a sensible solution amenable to all parties, such as the legislative solution brokered this year in Washington state, the Department is attempting to bootstrap an inconsistently applied traditional test to the modern workplace.
Finally, the proposed rule further illustrates that neither the executive branch nor the judicial branch can adequately solve this complex issue. Instead, the Association again urges Congress to address the issue of worker classification and specifically to consider a “middle ground” third category of worker under federal law. For example, independent contractors often do not have health care benefits or access to unemployment or workers’ compensation coverage. However, under the current system, these can only occur by entering into an employment relationship.
HR Policy plans to submit comments to the proposed rule and looks forward to continuing to work with the Department to meaningfully address labor and employment issues arising in the workplace.
# # #
