New Rules Around Misclassifying Employees as Independent Contractors for 2024

Employers will have to deal with a changing legal environment in 2024 that will put more emphasis on worker classification.

There has long been a problem with employees being incorrectly classified as independent contractors, and new regulations have been put in place to address and resolve this problem. 

We’ll look at the effects of the proposed legislation in this blog article, as well as how companies can adjust to stay in compliance. 

The Department of Labor (“DOL”), the National Labor Relations Board (“NLRB”), the United States Equal Employment Opportunity Commission (“EEOC”), and the Occupational Safety and Health Administration (“OSHA”) have proposed regulations and guidance regarding the matter. Key changes include: Raising the minimum salary threshold, the Highly Compensated Employee (HCE) compensation threshold, and automatic updates every three years. 

The much anticipated new Fair Labor Standards Act (“FLSA”) independent contractor rule could be implemented soon. In 2022, the DOL put up a new rule that would clarify the FLSA’s definition of an independent contractor versus an employee. With this new regulation, the DOL hopes to lessen the misclassification of workers as independent contractors and give employers—or those who seek to engage with them—more clarity when it comes to dealing with self-employed people.

Employment laws change to reflect the needs of modern workers. In 2024, authorities adopted new measures to avoid employee misclassification as independent contractors. Misclassification can harm workers’ rights and benefits and expose businesses to legal liabilities. Misclassifying employees can result in legal penalties, back taxes, and brand damage. Businesses must examine and change their classification practices when regulators increase scrutiny.

During these legislative developments, Lyceum Insurance Services is a dependable partner for employers protecting their businesses and employees. We help fulfill businesses’ and workers’ different demands. 

Act now to secure a resilient future for your business and your workforce. Reach out via our hotline at 301-840-6624 or email us at [email protected] today!