Update: U.S. Department of Labor Withdraws Guidance on Independent Contractors and Joint Employment

On June 7, 2017, the U.S. Department of Labor (DOL) announced that it was withdrawing the Obama-era DOL 2015 and 2016 informal guidance memorandums on independent contractors and joint employment also referred to as joint employer. These memorandums were “Administrator’s Interpretations” meant to provide guidance as to how the law and related regulations with respect to independent contractors and joint employment should be interpreted and applied to employers.

Though the Obama-era Administrator’s Interpretations expanded the DOL’s position on independent contractors and joint employment, those guidance memorandums were based on current law and court rulings. Thus, employers should continue to exercise caution when classifying its workers as independent contractors. Further, employers should not be tempted to hold unjustifiable positions in joint employer situations. The DOL’s announcement on its website cautioned as much, stating: “Removal of the administrator interpretations does not change the legal responsibilities of employers under the Fair Labor Standards Act [. . .], as reflected in the department’s long-standing regulations and case law.”

The Trump DOL has not issued guidelines to replace the old ones or indicated whether or not new guidelines may be issued. When, and if, new guidelines are issued it’s unlikely that such guidelines will mark a significant departure from current law.

If you have questions regarding worker classification or joint employer issues at your organization, please contact an attorney at Bea & VandenBerk.

This article is provided for general information and is not intended to be legal advice for any specific situation.  If you are in need of specific advice or legal representation, please do not hesitate to contact us.

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