CHICAGO – Attorney General Kwame Raoul today opposed a U.S. Department of Labor proposed rule to dramatically alter the standard for how workers are classified as independent contractors under federal law. Raoul and a coalition of attorneys general and state and city labor agencies submitted comments in opposition to the rule, which would lead to more workers being misclassified as independent contractors and leave them without wage, overtime and other protections tied to employee status.
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“This misguided proposal will lead to more workers being misclassified as independent contractors, stripping them of important workplace protections,” Raoul said. “The proposed rule would also undercut law-abiding employers and shift more costs onto workers and states. I am proud to join this coalition urging the U.S. Department of Labor not to adopt this rule, and I will continue to stand up for workers and for law-abiding businesses.”
The coalition argues that the proposal is unlawful, does not reflect the realities of today’s workplace, and would worsen an already serious misclassification problem by making it easier for employers to avoid payroll taxes, minimum wage and overtime requirements, and other obligations that law-abiding employers follow.
Workers who qualify as independent contractors lose access to federal minimum wage and overtime protections, as well as other rights tied to employee status under the Fair Labor Standards Act, the Family and Medical Leave Act, and the Migrant and Seasonal Agricultural Worker Protection Act. The proposed rule would also create confusion for employers and state and local enforcement agencies by imposing a standard that departs from decades of case law and longstanding practice.
The proposal would cost states revenue by reducing payroll tax collections and employer contributions to unemployment and workers’ compensation systems, while increasing enforcement and public education burdens for states.
Joining Raoul in filing the comments are the Attorneys General of Arizona, California, Colorado, Connecticut, the District of Columbia, Hawaii, Massachusetts, Michigan, Minnesota, New Jersey, New York, Oregon, Rhode Island, Vermont and Washington. The Minnesota Department of Labor and Industry, the Oregon Bureau of Labor and Industries, the Washington State Department of Labor & Industries, the Philadelphia Office of Worker Protections and the Minneapolis Department of Civil Rights also joined the comments.
