Biden’s Labor Department takes aim at Uber and DoorDash with new rule aimed to cut down on number of ‘independent contractors’ – By David Hamilton, Alexandra Olson and the Associated Press (Fortune) / Jan 9, 2024
The Biden administration enacted a new labor rule Tuesday that aims to prevent the misclassification of workers as “independent contractors,” a step that could bolster both legal protections and compensation for many in the U.S. workforce.
The Labor Department rule, which the administration proposed 15 months ago, replaces a scrapped Trump-era standard that lowered the bar for classifying employees as contractors. Such workers neither receive federal minimum wage protections nor qualify for employee benefits, such as health coverage and paid sick days.
The changes have long been viewed as especially bad news for companies like Uber and DoorDash — pioneers of the so-called gig economy, in which companies essentially rely on armies of freelance drivers, delivery people and others to provide services without traditional labor protections. Some gig workers say they prefer things this way, extolling the freedom to set their own hours and schedules. But others complain of exploitation by companies.
