We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • ::COVID-19 COVERAGE::
  • INDUSTRY PRESS ROOM
  • ABOUT
  • CONTACT
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Change Me
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Change Me
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
Home » Labor Department withdraws informal 2015 guidance on role of independent contractors
newsworthy

Labor Department withdraws informal 2015 guidance on role of independent contractors

June 10, 2017
DC Velocity Staff
No Comments

The Department of Labor (DOL) has withdrawn an informal interpretation of labor law issued in 2015 that trucking interests feared at the time could result in owner-operator drivers being classified as employees rather than independent contractors.

The agency's Wednesday decision, a copy of which was provided to DC Velocity (it has since been removed from the DOL web site) does not detail the reasons for its action. The agency said its decision does not relieve employers of their obligations under the Fair Labor Standards Act (FLSA), the law that governs minimum wage, worker overtime, and child labor laws.

In July 2015, Dr. David Weil, a Boston University economist and the nation's first permanent wage-and-hour administrator, wrote in the first of a series of memos that a six-step "economic realities" test should be applied to determine whether a worker is an employee or a contractor. In his non-binding opinion, Weil said the test would consider a worker to be an employee if the worker is economically dependent on the company. By contrast, a worker is a contractor if that worker is in business for himself or herself, according to the 2015 Weil memo.

The document went on to list six factors to guide the determination. However, rulings determining worker classification typically revolve around the degree of control a company exercises over a worker. The legal rule of thumb during President Barack Obama's administration was that a worker was an employee if he rendered services exclusively for one company.

Business interests have said that the memos, though not carrying the force of law, still could have made it more difficult for companies to prove that workers were independent contractors and not employees. They believed at the time that it was part of an Obama administration strategy to undermine the classification of workers as independent contractors.

Trucking executives and their attorneys have a keen interest in the issue, since an estimated 30 percent of driver contractors work almost exclusively with one carrier under long-term agreements. Gregory M. Feary, partner in Scopelitis, Garvin, Light, Hanson, & Feary, a transport law firm, wrote in a note that the DOL's action is a "welcome departure" from the views outlined in the Weil memos because it "signals less emphasis on the singular issue of exclusivity in the relationship between an independent contractor and transportation company, which appeared to be the cornerstone of the administrator's interpretations."

However, Geary cautioned that the industry needs to remain "vigilant in both actual practices and documentation"—especially when it comes to contract language governing their behavior toward contractors—to sustain contractor relationships that will pass legal muster.

Transportation Trucking Regulation/Government Truckload Less-than-Truckload Parcel & Postal Carriers
KEYWORDS Scopelitis, Garvin, Light, Hanson, & Feary
  • Related Articles

    Labor Department guidance on worker classifications could cast wide net

    FedEx chief rails against states' efforts to restrict use of independent contractors

    Independent truckers, trucking labor take legal steps to block implementation of U.S.-Mexico pact

Recent Articles by DC Velocity Staff

Report: Global TMS revenues to nearly double by 2025

E-commerce fulfillment squeezes retailers’ profit margins, Manhattan Associates says

Logistics-as-a-Service platform expands with $2.5 million funding round

You must login or register in order to post a comment.

Report Abusive Comment

Most Popular Articles

  • IBM survey says digitalization trends will sweep trucking industry by 2030

  • Gartner survey signals increased investment in resilience over the next two years

  • Truck driver hiring pool tightens to lowest point in three years, ACT says

  • What Level of Automation is Right for Your Warehouse?

  • Growing up … and up and up: interview with Sam Bertram

Now Playing on DCV-TV

D92f0dd1 a98c 434a 9e17 30b63ee72c90

Automated Pack-out and Print-Apply System for thredUP

DCV-TV 4: Viewer Contributed
SilMan Industries designed and implemented a mixed polybag-carton system, including automated print and apply, in a new regional Fulfillment Center for thredUP, one of the world’s largest online resale platforms for women’s and kids’ apparel, shoes, and accessories.The Situation Secondhand clothing and online...

FEATURED WHITE PAPERS

  • Using innovation to manage peak seasonal demand

  • Time to rethink your lift truck power

  • Warehouse Management System Project Toolkit

  • Solving Talent Management Challenges Now and In the Future

View More

Subscribe to DC Velocity Magazine

GET YOUR FREE SUBSCRIPTION
  • SUBSCRIBE
  • NEWSLETTERS
  • ADVERTISING
  • CUSTOMER CARE
  • CONTACT
  • ABOUT
  • STAFF
  • PRIVACY POLICY

Copyright ©2021. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing