ASA Monitors DOL’s Independent Contractor Rule Enforcement

On May 1, 2025, the Department of Labor’s Wage and Hour Division paused enforcement of the 2024 independent contractor rule and reverted to the older, multi-factor “economic realities” test. While the 2024 rule remains technically in effect, enforcement now follows Trump-era standards, considering factors such as opportunity for profit or loss, investment in equipment, degree of control, and relationship permanence—without defaulting to employee classification.

The construction industry has been outspoken about these changes, since it depends heavily on independent subcontractors. Many industry groups support the shift, citing flexibility and reduced risk of misclassification lawsuits. Labor advocates, however, argue that stricter tests are needed to address historic worker misclassification and ensure legal protection. Ongoing developments will be closely monitored.