The U.S. Department of Labor (DOL) has issued a final rule to refine the classification of workers as employees or independent contractors under the Fair Labor Standards Act. This rule aims to prevent the misclassification of workers, particularly in home care, by reinstating a multifactor analysis that assesses factors like the worker's relationship with the employer, financial stake, job permanence, and skill, according to the DOL. The “ultimate inquiry,” according to the rule, is whether the worker is economically dependent on the employer or if instead, they are in business for themselves.

The rule replaces the 2021 independent contractor rule and addresses concerns related to employee misclassification, ensuring proper rights and protections for workers. It takes effect on March 11, 2024, and seeks to maintain consistency with legal precedent.

• Related News: New Labor Department Final Rule Targets Independent Contractor Misclassification (McKnight's Home Care, 1/9/24)