Most US Companies to Classify Workers as Independent Contractors after Biden Blocked Trump Rule

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On Wednesday, the Biden administration blocked a rule put in place by the Trump administration that would have made it easier for companies to classify workers as independent contractors instead of full-time employees. It badly hit shares of app-based companies that depend on these independent workers to operate. The Biden administration is concerned about the misclassification of employees, which would prevent them from attaining benefits like paid leave and pay rates at or exceeding the federal minimum wage. But, companies that depend on independent contractors are finding a way forward that allows their staff to remain independent with continued flexibility and control over their hours. The vice president of communications and policy at DoorDash, Elizabeth Jarvis-Shean issued a statement.

Shean said, “Dashers work fewer than four hours per week on average and they overwhelmingly tell us how important the flexibility earn on their own schedule is to them, which is exactly why we remain committed to protecting their independence while providing greater benefits and security”. Uber also issued a statement and said, “The current employment system is outdated and forces a binary choice on workers to either be an employee with more benefits but less flexibility, or an independent contractor with more flexibility but limited protections. Uber believes that we can combine the best of both worlds by offering independent work opportunities to the hundreds of thousands of workers that use the Uber platform while also providing these workers with meaningful benefits”.

A spokesperson for Lyft issued a statement and said, “We see this as an opportunity to refocus the conversation on what drivers need and want, which is independence plus benefits”. Moreover, the trucking industry has opposed changing the classification structure and said it would put owner-operators out of work. The Owner-Operator Independent Drivers Association issued a statement and said, “It was disappointed by the Department of Labor decision. As we’ve seen with the disastrous rollout of the ABC Test in California, the implementation of one-size-fits-all rules for worker classification just won’t work in the trucking industry”. The OOIDA executive vice president, Lewie Pugh issued a statement and said, “The Independent Contractor Rule issued by the Trump administration would have provided some protection against this from happening on a national scale, and we’re disappointed that the rule is being withdrawn”.