On January 9, 2024, the U.S. Department of Labor (“DOL”) issued a long-awaited Final Rule that addresses when a worker is properly classified as an independent contractor under the Fair Labor Standards Act (the “FLSA”). Under its new Rule, independent contractors are characterized as those workers who, as a matter of economic reality, are not economically dependent on an employer for work; rather, they are in business for themselves.
The FLSA establishes, among other things, the federal minimum wage and requires covered employers to pay their employees one and one-half times the employee’s regular rate for hours worked over 40 in a workweek. Thus, the FLSA, with its minimum wage, overtime, and other protections for employees, does not apply these protections to independent contractors.
