DOL: New Rule for Independent Contractors

Hiring technicians as independent contractors to help with staffing issues or save on employee-related administrative costs can be a valuable strategy. However, it’s critical to ensure the arrangement meets the criteria set by the Department of Labor (DOL), since misclassifying workers as contractors can subject you to fines, back taxes and other penalties.

In March, the DOL implemented a new rule: Employee or Independent Contractor Classification Under the Fair Labor Standards Act. Historically, lab owners have found the guidelines for classifying employees to be ambiguous and even subjective. Similarly, the new rule doesn’t offer hard-and-fast guidelines; instead, it describes six factors meant to be considered all together to determine whether a worker is economically dependent on an employer for work or truly in business for themselves.

Said to be more aligned with judicial precedent on the topic, the new rule replaces the five-factor...