Old Rule Reinstated for Determining Worker Classification

The DOL issued a proposed rule that would rescind a 2024 final rule and create a new standard for determining whether a worker is an employee or independent contractor. The new rule—essentially the 2021 rule—applies an “economic reality” test to determine whether a worker is in business for him- or herself as an independent contractor or is an employee economically dependent on an employer for work. It also includes 2 “core factors” to help determine if a worker is economically dependent on an employer for work or in business for him- or herself: (1) the nature and degree of control over the work and (2) the worker’s opportunity for profit or loss based on initiative and/or investment. Comments to the proposed rule are being accepted through April 28, 2026. #IdeaoftheDay