One of the most common ways employers in the construction industry cheat workers, including millwrights, is by misclassifying them as independent contractors rather than employees. Your comment is needed TODAY in favor of a new U.S. Labor Department rule that would make it more difficult for contractors to misclassify workers. (Scroll down to see instructions for submitting your comment to the Labor Department by the Dec. 13 deadline.)
“The opposition would like to classify their employees as independent contractors to avoid paying workers’ compensation premiums, along with the employer portions of federal, state taxes, Social Security, and Medicare taxes,” said Rick Halford, political director for the Southern States Millwright Regional Council. “This is sometimes a 30% advantage over contractors that bid by the laws put in place.” Learn more about this kind of tax fraud.
The proposed rule would replace the January 2021 Independent Contractor Status Under the Fair Labor Standards Act rule that was implemented under the Trump administration. Using that rule, workers are more likely to be classified as independent contractors than they were prior to 2021.
The proposed rule seeks to combat employee misclassification, according to the DOL, and would create a framework more consistent with the longstanding legal precedent employers have used to classify workers as employees or independent contractors under the FLSA. The full text of the rulemaking notice is here.
“While independent contractors have an important role in our economy, we have seen in many cases that employers misclassify their employees as independent contractors, particularly among our nation’s most vulnerable workers,” said Secretary of Labor Marty Walsh. “Misclassification deprives workers of their federal labor protections, including their right to be paid their full, legally earned wages. The Department of Labor remains committed to addressing the issue of misclassification.”
Per the DOL, the proposed rule would:
- Align the department’s approach with courts’ FLSA interpretation and the economic reality test.
- Restore the multifactor, totality-of-the-circumstances analysis to determine whether a worker is an employee or an independent contractor under the FLSA.
- Ensure that all factors are analyzed without assigning a predetermined weight to a particular factor or set of factors.
- Revert to the longstanding interpretation of the economic reality factors. These factors include the investment, control and opportunity for profit or loss factors. The integral factor, which considers whether the work is integral to the employer’s business, is also included.
- Assist with the proper classification of employees and independent contractors under the FLSA.
- Rescind the 2021 Independent Contractor Rule.
The DOL is accepting public comments on the proposed changes through December 13th. Groups opposed to paying their workers fairly are mounting organized campaigns to oppose these changes, so it is important for workers’ voices to be heard.
We encourage our membership to comment favorably on these changes. See the step-by-step guide below on how to submit comments to the DOL online.
To comment – please follow this link: https://www.regulations.gov/document/WHD-2022-0003-0001
Click on the “Comment” button on the top left of the screen.
That will bring up the form to submit your comment. (Keep in mind that everything you submit will become public record.)
This is the suggested comment language. Please modify as needed with your information and any additional information you believe would be helpful.
Thank you for proposing important changes to the Employee or Independent Contractor Classification interpretation under the Fair Labor Standards Act. On behalf of (Millwright Local #) in (City, State), in solidarity with working families across the nation, I urge you to implement these changes.
As a skilled millwright, I depend on FLSA worker protections. These proposed changes represent significant and welcome progress toward classifying and paying workers the appropriate wages and benefits they are due.