The Biden administration this year plans to issue its final rules on independent contractor classification and joint employment, according to the Fall 2022 Unified Agenda of Regulatory and Deregulatory Actions issued by the US Office of Information and Regulatory Affairs. The agenda, released on Jan. 4, reports on the actions that federal administrative agencies plan to issue in the near- and long-term. The semi-annual agendas are issued in the spring and fall and outline federal agency goals for the months ahead, according to an article from law firm Littler Mendelson.
“Although there are no legal implications regarding the administration’s failure to issue the agenda in a timely manner, there are important considerations for the regulated community,” the article states. “For example, the lack of transparency in knowing what to expect makes it more difficult to hold the administrative state accountable for its plans.”
Not knowing regulatory priorities can also impact budget and resource planning for employers, especially during a time of high inflation and anticipated economic recession, Littler states, and Congress must also have “keen insight” of the administration’s regulatory plans to assess its budget requests and operations.
Independent contractor classification. A final rule is slated for May. On Jan. 7, 2021, the US Department of Labor under the prior administration published a final rule on independent contractor status under the Fair Labor Standards Act. The incoming Biden administration subsequently published final rules to delay and withdraw the 2021 rule. However, in March 2022, a district court in the Eastern District of Texas vacated the department’s delay and withdrawal rules, concluding that the 2021 rule became effective as of March 8, 2021.
The department continues to believe that the 2021 rule does not fully comport with the FLSA’s text and purpose as interpreted by courts and has proposed to rescind the 2021 rule and set forth an analysis for determining independent contractor status under the FLSA that “is more consistent with existing judicial precedent and the department’s longstanding guidance prior to the 2021 rule.”
Joint employer. The National Labor Relations Board issued a proposed rule in September 2022 broadening the standard for determining whether two employers, as defined by the National Labor Relations Act, are joint employers under the NLRA, thereby expanding joint employment liability. The public comment period closed on Dec. 21, 2022.
Read more about the regulatory agenda from Littler Mendelson.