DOL Proposes Rollback of Biden-Era Worker Classification Rule

March 4, 2026

What's New

The Department of Labor’s (DOL) Wage and Hour Division has proposed revisions to its interpretive worker classification rule that explains how the agency will analyze whether a worker is an employee or an independent contractor under the Fair Labor Standards Act, the Family and Medical Leave Act, and the Migrant and Seasonal Agricultural Worker Protection Act.

The proposed rule largely mirrors the Trump Administration’s 2021 rule, reviving a more streamlined economic reality analysis that DOL says is grounded in federal court precedent. DOL is accepting comments through April 28, 2026, and CWC plans to submit comments.

What It Means

If finalized, the rule would rescind the Biden Administration’s 2024 rule, an approach DOL stopped enforcing in May 2025 and that has been the subject of ongoing litigation.

Unlike the 2024 rule’s six unweighted factors, the proposal evaluates five factors but gives greater weight to two “core” considerations: (1) the nature and degree of the individual’s control over the work, and (2) the individual’s opportunity for profit or loss. Supporters argue the approach offers clearer, more predictable outcomes aligned with federal law that reduces what they view as a bias in favor of employee status. Critics contend it weakens worker protections by narrowing employee status.

What You Should Do

CWC encourages members to review the proposal and share practical or legal feedback for inclusion in our comments. Please direct input to [email protected]. Employers seeking a deeper refresher on classification risk should also consider CWC’s Fundamentals of Wage and Hour Compliance course.

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