Effective March 11, 2024, the Wage and Hour Division of the Department of Labor (DOL) revised its guidance on how to analyze whether a worker is an employee or an independent contractor under the Fair Labor Standards Act (FLSA). Here are some indicators:
Employee
- Working for someone else’s business
- Generally, can only earn more by working additional hours
- Typically uses the employer’s materials, tools and equipment
- Typically works for one employer or may be prohibited from working for others
- Continuing or indefinite relationship with the employer
- Employer decides how and when the work will be performed
- Employer assigns the work to be performed
Independent Contractor
- In business for themselves
- Can increase profit through business decisions
- Typically provides their own materials, tools and equipment and uses them to extend market reach
- Often works with multiple clients and companies
- Temporary relationship until project is completed
- Decides how and when they will perform the work
- Decides what work or projects they will take on