One of NFIB's top legislative priorities has consistently been to better define who is an independent contractor. The current 20 common-law factor test for determining who is an employee vs. an independent contractor continues to handcuff small businesses. These instructions are vague and unclear, making it difficult for small employers to know whether they are complying with the rules.
NFIB is closely monitoring the 112th Congress for the introduction of legislation that would change the current independent contractor rules and make it harder for a business owner to classify workers as independent contractors.
NFIB opposes any legislative proposals that would:
1. Eliminate safeguards in the law protecting business owners from liability when classifying workers as independent contractors based on accepted industry standards.
2. Allow independent contractors to go directly to the IRS and ask to be reclassified.
3. Require the IRS to work in conjunction with the Department of Labor about misclassification violations, exposing small business owners to additional audits and legal actions.
4. Increase reporting and paperwork requirements on small business.
NFIB has joined forces with the Small Business Legislative Council and other business groups in organizing the Independent Contractor Coalition to monitor legislative and regulatory activity in this area. In addition, the NFIB will be working to find a solution to finally clarify these confusing and onerous rules.