On May 1, 2025, the U.S. Department of Labor’s (DOL’s) Wage and Hour Division issued a Field Assistance Bulletin announcing that it is pausing enforcement of the Biden administration’s 2024 independent contractor rule under the Fair Labor Standards Act (FLSA). This move does not formally rescind the Biden-era rule, which remains in effect for private litigation.
The 2024 rule aimed to prevent companies from misclassifying workers as independent contractors to avoid paying benefits or offering workplace protections. The rule expanded the “economic reality” test requiring employers to weigh factors such as how much control workers had over their schedule and employment, how permanent that employment was, and how integral their work was to the core functioning of the company. The rule rescinded previous independent contractor guidance issued during the first Trump administration.
According to the Bulletin, the DOL is reconsidering the 2024 rule, including whether to rescind it. After further review, the DOL could revise or replace the rule. Although the regulation technically remains in effect, the DOL stated that the new guidance “reflects how the department is allocating enforcement resources during the review of the 2024 rule,” meaning it will not enforce the 2024 rules.
Until the DOL finishes its review of the 2024 rule, it will determine employee and independent contractor status based on Fact Sheet #13 (dated July 2008) and Opinion Letter FLSA2019-6 (if classifying workers in the context of virtual marketplace platforms).
Employers should also be aware that the analysis used to determine employee or independent contractor status may be different under state law. Find state-specific Employers Council whitepapers by clicking here. Employers are advised to consult with Employers Council to reduce the risk of misclassification. For assistance, you can contact us at info@employerscouncil.org.
Gayle Moser is an attorney for Employers Council.