DOL Proposes worker classification changes

[Lee B]

"The U.S. Department of Labor has published a new proposal on how workers should be classified saying that thousands of people have been incorrectly labeled as contractors rather than employees, potentially curtailing access to benefits and protections they rightfully deserve.

Misclassifying workers as independent contractors denies those workers protections under federal labor standards, promotes wage theft, allows certain employers to gain an unfair advantage over businesses, and hurts the economy, the department said Tuesday.

The reaction in markets for major gig companies was immediate. Shares of Lyft and Uber tumbled about 13%. in early trading.

The misclassification of workers has negatively impacted delivery workers, custodians, truck drivers, waiters, construction workers and more, according to the department.

"While independent contractors have an important role in our economy, we have seen in many cases that employers misclassify their employees as independent contractors, particularly among our nation's most vulnerable workers," said Secretary of Labor Marty Walsh in a prepared statement. "Misclassification deprives workers of their federal labor protections, including their right to be paid their full, legally earned wage."

The gig worker tax returns that I did didn't even come close to making minimum wage.

[BulldogTom]

This looks like the same wording and justifications that California used when they passed AB5.   It has been extremely challenging law with lots of exceptions.   Trucking is the one most affected in CA (although some would say Uber/Lyft).   The AB5 regs say that if you hire a contractor to do work that your company normally performs, they are an employee.   Lots of trucking companies hire independent truckers to fill in when they have more freight than they can handle with their own trucks.   AB5 says they have to be hired on as employees, even for short term gigs.   The truckers went to court and lost when the Supreme Court refused to hear their case.

Tom
Longview, TX