Independent contractor rules are changing again

The National Labor Relations Board has narrowed the definition of independent contractors — and small-business owners will have to adapt.

The decision, issued by the NLRB in a matter involving The Atlanta Opera Inc., overrules a litmus test established during the Trump administration in 2019 for how businesses classify independent contractors in favor of an earlier test (one known as the FedEx Home Delivery standard) established in 2014.

“In today’s decision, the Board returns to the independent contractor test articulated in FedEx II and reaffirms the Board’s commitment to the core common-law principles that the Supreme Court has determined should guide the Board’s consideration of questions involving employee status,” said NLRB Chairman Lauren McFerran in a statement announcing the decision. “Applying this clear standard will ensure that workers who seek to organize or exercise their rights under the National Labor Relations Act are not improperly excluded from its protections.”

What the new standard means

Both tests examine an array of factors to determine whether a worker is an employee or an independent contractor, including how much control a worker has over their work, whether it's done under the supervision of an employer and the method of payment, according to a blog post by law firm Bowditch & Dewey.

https://www.bizjournals.com/seattle/news/2023/06/15/nlrb-independent-contractor-rules-change.html