Defining a worker as an “employee” or an “independent contractor” became more difficult in 2024 due to the U.S. Department of Labor (DOL) revoking a 2021 rule. With the previous rule, definitions and determining factors for classification were clear. In its absence, classifying a hire correctly is surrounded by uncertainty.

NFIB opposed this rule and has filed a lawsuit challenging it. NFIB sent letters of support to the U.S. Senate and House for legislation to repeal DOL’s 2024 rule, arguing that it adds complexity to the classification process and can lead to frivolous lawsuits and enforcement actions against small businesses. NFIB supports the protection of – and efforts to secure – the right of individuals to work as independent contractors.

You can learn more about how to determine a worker’s classification in NFIB’s Legal Guide.