The PA Chamber has been actively resisting efforts to dramatically restrict the ability of individuals to operate as independent contractors. We recently joined the U.S. Chamber and 200 other organizations in submitting public comments opposing the U.S. Department of Labor’s proposed independent contractor regulation, arguing it is unclear, overly restrictive, and would upend millions of successful, legitimate independent contractor relationships.
As our public comments state, the current DOL rule regarding independent contractor classification, which went into effect on March 8, 2021, provides badly needed clarity, uniformity, and simplicity to the independent contractor analysis and accounts for the realities of the modern workplace. In doing so, it allows businesses and independent contractors to structure mutually beneficial relationships most suitable to those realities.
The Proposed Rule, which would rescind the current rule from 2021, would do just the opposite. Its undefined terms and vague concepts create a scenario where business owners and small business independent contractors could never be truly confident they have correctly classified their arrangement. As a result of this uncertainty, the Proposed Rule has the potential to all but eliminate, or at least severely limit, the use of the independent contractor model in the modern workplace, depriving many small business entrepreneurs of their livelihood.
The PA Chamber has led the charge opposing efforts in Pennsylvania. In August of this year, the PA Chamber testified at a meeting of the PA Department of Labor & Industry’s Joint Task Force on Misclassification of Employees, pushing back against a similar recommendation to redefine independent contractor status in Pennsylvania. We also coordinated participation at this hearing by several PA Chamber member companies including an app-based rideshare company, trucking company, and a freelance photographer.
Millions of legitimate, productive independent contractor relationships, where both parties benefit from agreed upon terms, exist across the nation. We are committed to opposing efforts at any level of government to prohibit these employment arrangements and will continue working with our members, legislators, and administrative officials to advocate for a regulatory framework that makes sense for the modern workforce.