I have often said that the USDOL is a politically charged industry and its view on legal issues (much like the National Labor Relations Board) shifts with the Administration that is in power. For example, under the prior administration, the agency took a pro-business stance and issued pro-business Opinion Letters on independent contractor and working time issues. Well, a new day has dawned at the agency with a retreat by the USDOL on these and other matters.
It is as simple as withdrawing the Opinion Letters. On February 19, 2021, the USDOL rescinded these letters, showing that the pendulum is swinging back towards employee interests. The first Opinion Letter (FLSA 2019-6), dealt with independent contractors for a virtual marketplace company; that letter favored independent contractor status for these workers within the parameters of the Opinion Letter. This letter followed the agency’s February 5, 2021 announcement of a delay in the issuance of a final rule on this very important topic.
The second Opinion Letter related to working time issues, in particular whether sleeping time for truckers was compensable. That pronouncement (FLSA2019-10) had opined that the sleeping time was presumptively non-compensable, if there was a sufficient showing that the worker was relieved if all productive duties and there were adequate facilities. The agency believed, now, that the Opinion Letter was inconsistent with the USDOL decades old view that employees could go as much as eight hours in a sleep mode, without needing to be paid for the time. Other letters on this topic, which FLSA 2019-10 had “overturned,” were now reinstated.
The withdrawal of these letters is an indication of how the USDOL swings in the winds of political change. Although these letters might provide a safe harbor for alleged offenses occurring while they were in force (which was not that long) now they are “history.” The more salient point is that employers need to expect (and prepare for) a wholesale expansion of FLSA rules and rulings in favor of employees, starting with a tightening up of the definition of independent contractor.
Stay tuned and be aware…