On May 1, 2025, the U.S. Department of Labor (DOL) issued Field Assistance Bulletin (FAB) 2025-1, outlining the criteria the agency will use for determining employee or independent contractor status when enforcing the Fair Labor Standards Act (FLSA). Specifically, DOL instructs field agents not to apply the 2024 Rule in current enforcement matters while the Department considers future action.

Background

On January 10, 2024, the Biden Administration published a final rule revising Department of Labor (DOL) guidance on determining whether an individual is an employee or an independent contractor under the Fair Labor Standards Act (FLSA). This 2024 Rule rescinded the first Trump Administration’s 2021 Independent Contractor Rule. Several lawsuits are pending in federal courts challenging the 2024 Rule. In those lawsuits, the current Trump Administration DOL has taken the position that it is reconsidering the 2024 Rule, including whether to rescind it. Additionally, the DOL’s Wage and Hour Division (WHD) is currently developing a standard for determining employee versus independent contractor status under the FLSA.

Enforcement Guidance

While the DOL reviews the 2024 Rule, DOL field guidance states, “agency investigators are directed not to apply the 2024 Rule’s analysis in current enforcement matters.” Instead, the WHD will rely on principles outlined in Fact Sheet #13 and the reinstated Opinion Letter FLSA2019-6, which addresses independent contractor/employee classification in the context of virtual marketplace platforms. According to the DOL, this approach will provide greater clarity for businesses and workers while legal and regulatory questions are resolved.

Employer Takeaway

The DOL’s new guidance does not alter existing regulations but reflects the Department’s approach to enforcement during the review of the 2024 Rule. The FAB supersedes any prior or conflicting guidance provided to the WHD staff on enforcement related to independent contractor misclassification. Until further action is taken, the 2024 Rule remains in effect for purposes of private litigation, and the FAB does not change the rights of employees or the responsibilities of employers under the FLSA. Employers, therefore, may want to consult with their legal counsel if necessary and continue to monitor the situation for updates.