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Understanding the New Department of Labor Employee or Independent Contractor Classification Rule (2024)

by | Jun 20, 2024 | Employment Law |

On January 10, 2024, the Department of Labor (DOL) published a final rule, effective March 11, 2024, revising how workers are classified as employees or independent contractors under the Fair Labor Standards Act (FLSA). This is important because employees receive minimum wage and overtime protections, while independent contractors generally don’t.

What the Rule Does:

  • Shifts the Focus: The rule moves away from a single test and emphasizes a six-factor analysis.
  • Key Factors: These factors include the worker’s opportunity for profit or loss; the level of skill and investment required; the nature and degree of control; the extent to which the work performed is an integral part of the potential employer’s business; and the degree of permanence of the work relationship.
  • Protects Workers: By ensuring proper classification, the Department of Labor (DOL) aims to guarantee minimum wage and overtime rights to those who qualify as employees.

What it Means for You:

  • Businesses: Carefully evaluate worker classifications based on the new six-factor analysis. Misclassification can lead to penalties and back pay owed to workers.
  • Workers: Understand your rights and how the new rule can impact your classification.


Remember: This is a brief explanation of the “final” rule.  Future legal challenges may follow, and other updates may take effect in the coming months or years and policymakers may even consider revisions.

Let Us Review Your Case

Employees are sometimes misclassified as independent contractors. Workers who have been classified as independent contractors but are more like true employees may also be entitled to compensation for lost wages and overtime pay.  Determining whether or not you have a valid misclassification case requires an in-depth analysis of your individual situation.  Contact us today. The attorneys at NachtLaw, P.C. have over 20 years of labor and employment law experience and are prepared to help you recover lost wages.