On May 1, 2025, the United States Department of Labor Wage and Hour Division (DOL) announced that it will not enforce the 2024 independent contractor rule when it performs its compliance investigations; for a summary of the rule see our January 2024 blog, That Independent Contractor May Be An Employee Now.

The announcement, Field Assistance Bulletin (2025-1 FAB), (click here for full text) is applicable ONLY for DOL FLSA worker classification dispute investigation and directs the DOL to rely on criteria set forth in a DOL 2008 Fact Sheet. Under the 2008 Fact Sheet, the DOL will examine:

• the extent to which the services rendered are an integral part of your company’s business;
• the permanency of the relationship;
• the amount of the contractor’s investment in facilities and equipment;
• the nature and degree of control by your company;
• the contractor’s opportunities for profit and loss;
• the amount of initiative, judgment, or foresight in open market competition with others required for the success of the contractor; and
• the degree of independent contractor’s business organization and operation.

Although the DOL will stop enforcing the 2024 Rule, until further action is taken, as a practical matter, the DOL’s interpretation of the independent contractor test changes very little. The 2024 Rule remains in effect for purposes of private litigation and does not apply to any other federal or state law. The courts may choose to disregard the DOL’s guidance on the rule.

If you would like to discuss or receive more information on the content of this post, please contact us.  The attorneys at Boodell & Domanskis are available to answer your questions about any general issues concerning your business.