ABC criticizes U.S. Department of Labor’s independent contractor rule

by arslan_ahmed | January 26, 2024 2:15 pm

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Associated Builders and Contractors (ABC) expresses strong opposition to the U.S. Department of Labor’s (DOL) final rule on independent contractors under the Fair Labor Standards Act.

ABC had previously supported the 2021 final rule, which aimed to simplify and clarify the criteria for distinguishing between independent contractors and employees under the Fair Labor Standards Act. However, the Biden administration froze and ultimately rescinded the rule, triggering legal action by ABC and other industry groups.

In March 2021, ABC, along with its Southeast Texas chapter and the Coalition for Workforce Innovation (CWI), filed a lawsuit against the DOL. Despite initial setbacks, the U.S. District Court for the Eastern District of Texas upheld the ABC-supported rule in March 2022, allowing it to take effect.

Notably, in October 2022, the DOL proposed a new rule to replace the 2021 version, leading ABC to submit opposing comments in December of that year. ABC argues that the latest rule jeopardizes the construction industry’s reliance on legitimate independent contractors, who contribute specialized skills and stability to the sector.

According to Ben Brubeck, ABC’s vice-president of regulatory, labor, and state affairs, the rule introduces ambiguity and complexity.

“Under the rule’s multifactor test, employers will now be forced to guess which factors should be given the greatest weight in making the determination. Instead of promoting much-needed economic growth and protecting legitimate independent contractors, the final rule will result in more confusion and expensive, time-consuming, unnecessary, and often frivolous litigation, as both employers and workers will not understand who qualifies as an independent contractor,” says Brubeck.

“Legitimate independent contractors are a vital part of the construction industry, providing specialized skills, entrepreneurial opportunities, and stability during fluctuations of work common to the industry. They play an important role for large and small contractors, delivering construction projects safely, on time and on budget for their government and private customers. This move will jeopardize the ability of construction firms to continue the industry’s longstanding practice of utilizing legitimate independent contractors,” he adds.

The ongoing legal battle and regulatory changes surrounding independent contractor classification continue to stir debate within the construction and architecture community, with ABC emphasizing the potential negative impact on economic growth and the industry’s longstanding practices.

Source URL: https://www.constructionspecifier.com/abc-criticizes-u-s-department-of-labors-independent-contractor-rule/

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