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Thursday, June 8, 2017

U.S. Department of Labor withdraws Obama guidance on independent contractors, joint employment

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The U.S. Department of Labor announced June 7, 2017 that it has withdrawn informal guidance issued by the Obama Administration related to independent contractors and joint employment. The guidance on independent contractors was issued in 2015, and the guidance on joint employment was issued in 2016, both in the form of so-called “Administrator’s Interpretations,” which was a form of guidance the DOL adopted when it ended the longstanding practice of issuing Opinion Letters.
Here is the government’s news release from the DOL website:

U.S. Secretary of Labor Alexander Acosta today announced the withdrawal of the U.S. Department of Labor’s 2015 and 2016 informal guidance on joint employment and independent contractors. Removal of the administrator interpretations does not change the legal responsibilities of employers under the Fair Labor Standards Act and the Migrant and Seasonal Agricultural Worker Protection Act, as reflected in the department’s long-standing regulations and case law. The department will continue to fully and fairly enforce all laws within its jurisdiction, including the Fair Labor Standards Act and the Migrant and Seasonal Agricultural Worker Protection Act.

Common Sense Counsel: This development is welcomed news for all businesses who seek to legally distance themselves from the independent contractors and temporary employment services they utilize. However, the terms of the independent contractual agreements and temporary staffing contacts, are still critical to reducing the risk of being considered a joint employer under a variety of state and federal laws.

This article originally appeared as a Constangy Bulletin drafted by  Constangy law partners, James M. Coleman and Robin E. Shea.