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NLRB returns to old independent contractor standard in new ruling

June 14, 2023

The National Labor Relations Board returned to an earlier standard for determining who is an independent contractor, making it more difficult to classify workers as such.

“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 press release. “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.”

Whether a worker is an independent contractor will be guided by a list of common-law factors, according to a press release by the board. It noted the entrepreneurial opportunity for gain or loss should not be the “animating principle” of the independent contractor test.

The FedEx case was decided by the board during the Obama administration in 2014. However, the standard in that case was overturned in 2019 in the SuperShuttle DFW Inc. case by a Trump-appointed board.

The Coalition for Workforce Innovation criticized Tuesday’s ruling in a statement.

“We are disappointed in the board’s decision to revert to the previous standard that disregards the fact that independent workers are a mosaic of consultants, freelancers and contractors working independently or with entrepreneurs and other independents to build businesses, develop their careers, pursue artistic or occupational passions or supplement and expand their overall economic opportunities,” said Evan Armstrong, chair of the coalition. “Sadly, the move away from the Super Shuttle standard decreases clarity and threatens the flexible independent model that benefits workers, consumers, entrepreneurs, businesses and the overall economy.”

Tuesday’s case involved makeup artists, wig artists and hair stylists at the Atlanta Opera. They had filed an election petition with the board seeking union representation. The NLRB found they were not independent contractors but covered employees.