LEGAL Matters
A New Federal Standard for Worker Classification I n a significant move, the U.S. Department of Labor (DOL) announced in Field Assistance Bulletin 2025-1 that it will no longer enforce the 2024 independent contractor rule under the Fair Labor Standards Act (FLSA). Instead, the agency has reinstated the 2008 economic realities test, which provides a more flexible framework for determining whether a worker is an employee or an independent contractor. While the agency’s interpretative shift is notable, it’s important to keep things in perspective. Employers face various legal criteria to determine whether a worker is an employee or an independent contractor, depending on the specific law or regulation. For instance, the IRS uses a different test than the Department of Labor. State laws vary; some states use the IRS’s test, while others apply the stricter ABC test. The Department of Labor’s announcement does not affect an employer’s potential liability to the IRS or to state agencies. New DOL Guidance Reshapes Independent Contractor Rules: What FLOORING RETAILERS MUST KNOW ABOUT CLASSIFYING INSTALLERS
Kaytie M. Pickett General Counsel for the WFCA, Partner Jones Walker LLP “ Independent contractor
classification is governed by multiple tests— and compliance with one does not guarantee compliance with all.”
18 Premier Flooring Retailer tise | 2026
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