{"id":246840,"date":"2025-05-19T06:59:06","date_gmt":"2025-05-19T06:59:06","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/legal\/dol-retracts-biden-era-independent-contractor-classification-rule\/"},"modified":"2025-05-19T06:59:06","modified_gmt":"2025-05-19T06:59:06","slug":"dol-retracts-biden-era-independent-contractor-classification-rule","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=246840","title":{"rendered":"DOL Retracts Biden-Era Independent Contractor Classification Rule"},"content":{"rendered":"


\n<\/p>\n

On May 1, 2025, the United States Department of Labor\u2019s (\u201cDOL\u201d) Wage and Hour Division announced<\/a> it would not enforce or apply the Biden-era 2024 Final Rule regarding independent contractor classification (\u201c2024 Rule\u201d). Specifically, the DOL directed its investigators \u201cnot to apply the 2024 Rule\u2019s analysis\u201d in enforcement matters. The DOL\u2019s announcement will undoubtedly make it easier to classify workers as independent contractors at the federal level\u2014and continues a seesaw of regulatory pull-back from Biden-era directives. While the 2024 Rule does remain in effect for private litigation and certain state-specific tests still impose higher worker classification standards than the current federal guidelines, the DOL\u2019s announcement is a win for employers seeking to classify workers as contractors.<\/p>\n

<\/span><\/p>\n

The 2024 Rule<\/strong><\/p>\n

Under the 2024 Rule, classifying workers as independent contractors was somewhat akin to threading a needle. Imposed on March 15, 2024, the 2024 Rule mandated a complex, employee-friendly analysis that focused on a holistic review of the \u201ctotality of the circumstances\u201d to ascertain whether a worker was \u201ceconomically dependent\u201d on an employer and, therefore, not an independent contractor. These six factors included:<\/p>\n

    \n
  1. The nature and degree of an employer\u2019s control over the worker;<\/li>\n
  2. The worker\u2019s opportunity for profit or loss;<\/li>\n
  3. Any investments by the workers and the employer;<\/li>\n
  4. The degree of permanence of the working relationship;<\/li>\n
  5. The extent to which the work performed is integral to the employer\u2019s business; and<\/li>\n
  6. The amount of specialized skill and business initiative required.<\/li>\n<\/ol>\n

    Under the 2024 Rule, no factor was assigned more weight than another. Thus, the 2024 Rule was commonly referred to as the \u201ctotality of the circumstances\u201d test. The net result was a high degree of both difficulty and uncertainty for employers seeking to classify workers as independent contractors.<\/p>\n

    Legal Challenges to the 2024 Rule<\/strong><\/p>\n

    Business groups quickly challenged the 2024 Rule in courts across the country. At present, five lawsuits are pending. In each, the main argument is that the 2024 Rule was arbitrary, capricious, and imposed an undue burden on businesses. No court has halted or enjoined the 2024 Rule. While the Biden-era DOL mounted a vigorous defense in each case, the current DOL\u2019s retreat from the 2024 Rule renders the ultimate outcome of these cases unclear. For example, in one case pending before the Fifth Circuit (Frisard\u2019s Transp., LLC v. United States<\/em>), the Court of Appeals stayed the proceeding after the government submitted a status report noting the DOL was in the process of reconsidering the 2024 Rule-at-issue in the litigation. Ultimately, the DOL\u2019s pivot to the more lenient standard could have massive implications for these proceedings.<\/p>\n

    The DOL Retracts the 2024 Rule<\/strong><\/p>\n

    In its May 1 announcement, the DOL directed investigators to analyze a worker\u2019s status under the longstanding \u201ceconomic reality\u201d test, described in the Department\u2019s 2008 Fact Sheet 13 <\/a>and 2019 Opinion Letter<\/a>. The more traditional economic realities test looks at various factors to determine whether a worker is actually in business for themselves (and therefore a contractor) or dependent on the hiring entity (and thus an employee). These factors include:<\/p>\n

      \n
    1. Whether the work is integral to the hiring entity\u2019s business;<\/li>\n
    2. The permanency of the parties\u2019 relationship;<\/li>\n
    3. The contractor\u2019s investments in facilities or equipment;<\/li>\n
    4. The degree of control by the hiring entity over the contractor;<\/li>\n
    5. The contractor\u2019s opportunity for profit or loss;<\/li>\n
    6. The amount of independent judgment or initiative required in marketplace competition for the contractor to succeed; and<\/li>\n
    7. The degree of independence with which the contractor organizes and operates their business.<\/li>\n<\/ol>\n

      This traditional economic reality test is widely considered more employer-friendly. It is highly-likely that the DOL under President Trump will issue new, formal rulemaking on the subject in the near future.<\/p>\n

      Employer Takeaways<\/strong><\/p>\n

      Regardless of the DOL\u2019s announcement, employers should remain vigilant and ensure they are compliant with applicable classification rules; which greatly vary by jurisdiction.<\/p>\n

      For example, certain states\u2019 classification standards far outpace federal guidelines and are more employee friendly. California, New Jersey, and Massachusetts use the much stricter \u201cABC test\u201d to determine whether a worker is an independent contractor. Under that test, employers must prove (1) a worker is free from the hiring entity’s control and direction, (2) the work is outside the hiring entity’s usual course of business, and (3) the worker is customarily engaged in an independently established trade, occupation, or business. Employers must prove all three elements to properly classify a worker as an independent contractor.<\/p>\n

      Employers should also closely monitor regulatory developments. As noted above, it is highly likely that the DOL will implement a new final rule in the near future. If and when that occurs, employers should be prepared for accompanying changes and evaluate their existing worker classifications. Given the shifting administrative environment, it is crucial that employers stay flexible in order to both<\/em> maximize opportunities presented by favorable changes and, conversely, be prepared if\u2014or when\u2014the regulatory winds shift once more.<\/p>\n\n","protected":false},"excerpt":{"rendered":"

      On May 1, 2025, the United States Department of Labor\u2019s (\u201cDOL\u201d) Wage and Hour Division announced it would not enforce or apply the Biden-era 2024 Final Rule regarding independent contractor classification (\u201c2024 Rule\u201d). Specifically, the DOL directed its investigators \u201cnot to apply the 2024 Rule\u2019s analysis\u201d in enforcement matters. The DOL\u2019s announcement will undoubtedly make […]<\/p>\n","protected":false},"author":1,"featured_media":246841,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[97],"tags":[47138,16969,18968,30654,15175,90395,7318],"dealstore":[],"offerexpiration":[],"class_list":["post-246840","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-legal","tag-bidenera","tag-classification","tag-contractor","tag-dol","tag-independent","tag-retracts","tag-rule"],"yoast_head":"\nDOL Retracts Biden-Era Independent Contractor Classification Rule - Som2ny Network<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fivemor.com\/?p=246840\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"DOL Retracts Biden-Era Independent Contractor Classification Rule - Som2ny Network\" \/>\n<meta property=\"og:description\" content=\"On May 1, 2025, the United States Department of Labor\u2019s (\u201cDOL\u201d) Wage and Hour Division announced it would not enforce or apply the Biden-era 2024 Final Rule regarding independent contractor classification (\u201c2024 Rule\u201d). Specifically, the DOL directed its investigators \u201cnot to apply the 2024 Rule\u2019s analysis\u201d in enforcement matters. The DOL\u2019s announcement will undoubtedly make […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/fivemor.com\/?p=246840\" \/>\n<meta property=\"og:site_name\" content=\"Som2ny Network\" \/>\n<meta property=\"article:published_time\" content=\"2025-05-19T06:59:06+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"630\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/fivemor.com\/?p=246840#article\",\"isPartOf\":{\"@id\":\"https:\/\/fivemor.com\/?p=246840\"},\"author\":{\"name\":\"admin\",\"@id\":\"https:\/\/fivemor.com\/#\/schema\/person\/b85e3c3dc0e1daea076524dc8810c371\"},\"headline\":\"DOL Retracts Biden-Era Independent Contractor Classification Rule\",\"datePublished\":\"2025-05-19T06:59:06+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/fivemor.com\/?p=246840\"},\"wordCount\":806,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/fivemor.com\/#organization\"},\"image\":{\"@id\":\"https:\/\/fivemor.com\/?p=246840#primaryimage\"},\"thumbnailUrl\":\"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png\",\"keywords\":[\"BidenEra\",\"Classification\",\"Contractor\",\"DOL\",\"Independent\",\"Retracts\",\"rule\"],\"articleSection\":[\"Legal\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/fivemor.com\/?p=246840#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/fivemor.com\/?p=246840\",\"url\":\"https:\/\/fivemor.com\/?p=246840\",\"name\":\"DOL Retracts Biden-Era Independent Contractor Classification Rule - Som2ny Network\",\"isPartOf\":{\"@id\":\"https:\/\/fivemor.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/fivemor.com\/?p=246840#primaryimage\"},\"image\":{\"@id\":\"https:\/\/fivemor.com\/?p=246840#primaryimage\"},\"thumbnailUrl\":\"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png\",\"datePublished\":\"2025-05-19T06:59:06+00:00\",\"breadcrumb\":{\"@id\":\"https:\/\/fivemor.com\/?p=246840#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/fivemor.com\/?p=246840\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/fivemor.com\/?p=246840#primaryimage\",\"url\":\"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png\",\"contentUrl\":\"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png\",\"width\":1200,\"height\":630},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/fivemor.com\/?p=246840#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/fivemor.com\/?bp_activities=1\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"DOL Retracts Biden-Era Independent Contractor Classification Rule\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/fivemor.com\/#website\",\"url\":\"https:\/\/fivemor.com\/\",\"name\":\"Som2ny Network\",\"description\":\"Daily Deals\",\"publisher\":{\"@id\":\"https:\/\/fivemor.com\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/fivemor.com\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/fivemor.com\/#organization\",\"name\":\"Som2ny Network\",\"url\":\"https:\/\/fivemor.com\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/fivemor.com\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/fivemor.com\/wp-content\/uploads\/2026\/07\/4a0953c4-logo-300x86-1.png\",\"contentUrl\":\"https:\/\/fivemor.com\/wp-content\/uploads\/2026\/07\/4a0953c4-logo-300x86-1.png\",\"width\":300,\"height\":86,\"caption\":\"Som2ny Network\"},\"image\":{\"@id\":\"https:\/\/fivemor.com\/#\/schema\/logo\/image\/\"}},{\"@type\":\"Person\",\"@id\":\"https:\/\/fivemor.com\/#\/schema\/person\/b85e3c3dc0e1daea076524dc8810c371\",\"name\":\"admin\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/fivemor.com\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/729ae85bf62b9917e93538db2f2688ca?s=96&r=g&default=https%3A%2F%2Ffivemor.com%2Fwp-content%2Fplugins%2Fbuddypress-first-letter-avatar%2Fimages%2Fdefault%2F96%2Flatin_a.png\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/729ae85bf62b9917e93538db2f2688ca?s=96&r=g&default=https%3A%2F%2Ffivemor.com%2Fwp-content%2Fplugins%2Fbuddypress-first-letter-avatar%2Fimages%2Fdefault%2F96%2Flatin_a.png\",\"caption\":\"admin\"},\"sameAs\":[\"https:\/\/fivemor.com\"],\"url\":\"https:\/\/fivemor.com\/?author=1\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"DOL Retracts Biden-Era Independent Contractor Classification Rule - Som2ny Network","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/fivemor.com\/?p=246840","og_locale":"en_US","og_type":"article","og_title":"DOL Retracts Biden-Era Independent Contractor Classification Rule - Som2ny Network","og_description":"On May 1, 2025, the United States Department of Labor\u2019s (\u201cDOL\u201d) Wage and Hour Division announced it would not enforce or apply the Biden-era 2024 Final Rule regarding independent contractor classification (\u201c2024 Rule\u201d). Specifically, the DOL directed its investigators \u201cnot to apply the 2024 Rule\u2019s analysis\u201d in enforcement matters. The DOL\u2019s announcement will undoubtedly make […]","og_url":"https:\/\/fivemor.com\/?p=246840","og_site_name":"Som2ny Network","article_published_time":"2025-05-19T06:59:06+00:00","og_image":[{"width":1200,"height":630,"url":"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png","type":"image\/png"}],"author":"admin","twitter_card":"summary_large_image","twitter_misc":{"Written by":"admin","Est. reading time":"4 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/fivemor.com\/?p=246840#article","isPartOf":{"@id":"https:\/\/fivemor.com\/?p=246840"},"author":{"name":"admin","@id":"https:\/\/fivemor.com\/#\/schema\/person\/b85e3c3dc0e1daea076524dc8810c371"},"headline":"DOL Retracts Biden-Era Independent Contractor Classification Rule","datePublished":"2025-05-19T06:59:06+00:00","mainEntityOfPage":{"@id":"https:\/\/fivemor.com\/?p=246840"},"wordCount":806,"commentCount":0,"publisher":{"@id":"https:\/\/fivemor.com\/#organization"},"image":{"@id":"https:\/\/fivemor.com\/?p=246840#primaryimage"},"thumbnailUrl":"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png","keywords":["BidenEra","Classification","Contractor","DOL","Independent","Retracts","rule"],"articleSection":["Legal"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/fivemor.com\/?p=246840#respond"]}]},{"@type":"WebPage","@id":"https:\/\/fivemor.com\/?p=246840","url":"https:\/\/fivemor.com\/?p=246840","name":"DOL Retracts Biden-Era Independent Contractor Classification Rule - Som2ny Network","isPartOf":{"@id":"https:\/\/fivemor.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/fivemor.com\/?p=246840#primaryimage"},"image":{"@id":"https:\/\/fivemor.com\/?p=246840#primaryimage"},"thumbnailUrl":"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png","datePublished":"2025-05-19T06:59:06+00:00","breadcrumb":{"@id":"https:\/\/fivemor.com\/?p=246840#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/fivemor.com\/?p=246840"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/fivemor.com\/?p=246840#primaryimage","url":"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png","contentUrl":"https:\/\/fivemor.com\/wp-content\/uploads\/2025\/05\/63642d02c48641c084750c1333ad011221955ee9.png","width":1200,"height":630},{"@type":"BreadcrumbList","@id":"https:\/\/fivemor.com\/?p=246840#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/fivemor.com\/?bp_activities=1"},{"@type":"ListItem","position":2,"name":"DOL Retracts Biden-Era Independent Contractor Classification Rule"}]},{"@type":"WebSite","@id":"https:\/\/fivemor.com\/#website","url":"https:\/\/fivemor.com\/","name":"Som2ny Network","description":"Daily Deals","publisher":{"@id":"https:\/\/fivemor.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/fivemor.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/fivemor.com\/#organization","name":"Som2ny Network","url":"https:\/\/fivemor.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/fivemor.com\/#\/schema\/logo\/image\/","url":"https:\/\/fivemor.com\/wp-content\/uploads\/2026\/07\/4a0953c4-logo-300x86-1.png","contentUrl":"https:\/\/fivemor.com\/wp-content\/uploads\/2026\/07\/4a0953c4-logo-300x86-1.png","width":300,"height":86,"caption":"Som2ny Network"},"image":{"@id":"https:\/\/fivemor.com\/#\/schema\/logo\/image\/"}},{"@type":"Person","@id":"https:\/\/fivemor.com\/#\/schema\/person\/b85e3c3dc0e1daea076524dc8810c371","name":"admin","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/fivemor.com\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/729ae85bf62b9917e93538db2f2688ca?s=96&r=g&default=https%3A%2F%2Ffivemor.com%2Fwp-content%2Fplugins%2Fbuddypress-first-letter-avatar%2Fimages%2Fdefault%2F96%2Flatin_a.png","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/729ae85bf62b9917e93538db2f2688ca?s=96&r=g&default=https%3A%2F%2Ffivemor.com%2Fwp-content%2Fplugins%2Fbuddypress-first-letter-avatar%2Fimages%2Fdefault%2F96%2Flatin_a.png","caption":"admin"},"sameAs":["https:\/\/fivemor.com"],"url":"https:\/\/fivemor.com\/?author=1"}]}},"_links":{"self":[{"href":"https:\/\/fivemor.com\/index.php?rest_route=\/wp\/v2\/posts\/246840","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/fivemor.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/fivemor.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/fivemor.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/fivemor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=246840"}],"version-history":[{"count":0,"href":"https:\/\/fivemor.com\/index.php?rest_route=\/wp\/v2\/posts\/246840\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/fivemor.com\/index.php?rest_route=\/wp\/v2\/media\/246841"}],"wp:attachment":[{"href":"https:\/\/fivemor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=246840"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fivemor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=246840"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fivemor.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=246840"},{"taxonomy":"dealstore","embeddable":true,"href":"https:\/\/fivemor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fdealstore&post=246840"},{"taxonomy":"offerexpiration","embeddable":true,"href":"https:\/\/fivemor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fofferexpiration&post=246840"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}