DOL proposed redefinition of independent contractors would rescind late Trump-era 2021 Independent Contractor Rule
The Department of Labor has proposed changes regarding the definition of independent contractor under the Fair Labor Standards Act (FLSA). While the proposed rule change was available for comment on the Federal Register until November 28th, the question still remains: is employee misclassification a major trucking industry problem? Depends on who you ask. The use of independent contractors in the trucking industry has been the subject of legal and regulatory scrutiny in recent years.
Some say that using independent contractors allows trucking companies to have more flexibility in terms of the number of drivers they have on hand. Independent contractors can be hired on an as-needed basis, rather than as full-time employees, which allows trucking companies to adjust their workforce in response to fluctuations in demand.
However, others note that trucking companies may prefer to use independent contractors because it allows them to avoid certain legal responsibilities and obligations that come with having employees. For example, trucking companies are not required to pay unemployment insurance or workers' compensation for independent contractors and are not subject to certain labor laws that apply to employees.
In a significant ruling, a federal judge in California rejected a challenge against the state's independent contractor law, AB5, from the trucking industry.