01/08/2024

Biden Administration to Unveil Contractor Rule

The rule allegedly will upend the gig economy

The administration of U.S. President Joe Biden will release a final rule as soon as this week that will make it more difficult for companies to treat workers as independent contractors rather than employees that typically cost a company more, an administration official said.

The U.S. Department of Labor rule, which was first proposed in 2022 and is likely to face legal challenges, will require that workers be considered employees entitled to more benefits and legal protections than contractors when they are "economically dependent" on a company.

A range of industries will likely be affected by the rule, which will take effect later this year, but its potential impact on app-based services that rely heavily on contract workers has garnered the most attention. Shares of Uber Technologies, Lyft and DoorDash all tumbled at least 10 percent when the draft rule was proposed in October 2022.

Please select this link to read the complete article from Reuters.