The National Labor Relations Board is making it “more difficult for companies to treat workers as independent contractors rather than employees, handing workers in the gig economy and other industries a potential path to join unions,” Reuters reported Tuesday. Meanwhile, the US Department of Labor has delayed publication of its final rule on independent contractor status.

The new NLRB ruling overturns a Trump-era standard that was thought to favor business owners.

Under the ruling, according to the board, the board will consider entrepreneurial opportunity along with the traditional common-law factors by asking whether the evidence tends to show that a supposed independent contractor is, in fact, rendering services as part of an independent business. The board, however, expressly rejected the previous holding from the SuperShuttle case that entrepreneurial opportunity for gain or loss should be the “animating principle” of the independent-contractor test.

“In today’s decision, the Board returns to the independent contractor test articulated in FedEx II, and reaffirms the Board’s commitment to the core common-law principles that the Supreme Court has determined should guide the Board’s consideration of questions involving employee status,” Chairman Lauren McFerran said in a statement. “Applying this clear standard will ensure that workers who seek to organize or exercise their rights under the National Labor Relations Act are not improperly excluded from its protections.”

Members Gwynne E. Wilcox and David M. Prouty joined McFerran in issuing the decision. Member Marvin E. Kaplan agreed with the majority in part and dissented in part.

The standard only applies to employees covered by federal labor law.

Labor Department

Separately, the Labor Department has delayed publishing its final rule on independent contractor status. The rule now is expected to be published in October, five months later than previously planned.

“In a court filing Friday, attorneys for the DOL asked the Fifth Circuit Court of Appeals to continue its pause on litigation over an earlier attempt by the Biden DOL to regulate independent contractor status, so that it can finish its newest rulemaking on the issue,” Bloomberg Law reported. 

The proposed rule would more strictly limit how healthcare and other employers classify workers who are paid on an hourly basis.