Status

The ABC-opposed and House-passed PRO Act (H.R. 842/S. 420) includes a provision making it significantly more difficult for a worker to operate as an independent contractor. The bill does this by imposing the “ABC test,” used to determine if a worker is an employee or independent contractor, into the National Labor Relations Act, applying it nationwide.

In January 2021, the DOL under President Trump issued an independent contractor final rule under the Fair Labor Standards Act, which ABC strongly supported. Soon after, the DOL under President Biden issued a proposed rule to withdraw the final rule and ABC submitted comments opposing it. On March 26, ABC, ABC Southeast Texas Chapter and the Coalition for Workforce Innovation filed suit against DOL. In May, DOL rescinded the final rule. The legal challenge is pending.

The NLRB under President Biden is also trying to change the employee classification standard under the NLRA. In December 2021, the NLRB invited amicus briefs in The Atlanta Opera asking if the NLRB should revert back to the Obama-era standard, which severely undervalued the significance of a worker’s entrepreneurial opportunity for economic gain when considering classification. ABC joined the Coalition for a Democratic Workforce in filing an amicus brief, which highlighted NLRB’s two failed attempts to rewrite the standard for determining independent contractor status under the NLRA.

 

Desired Outcome

ABC is disappointed that the Biden administration rescinded the 2021 independent contractor final rule, which would have provided much-needed clarity for the independent contracting community, employers and employees. Independent contractors are an essential lifeline to the construction industry—they provide specialized skills, entrepreneurial opportunities and stability during fluctuations of work common to construction. Any independent contractor reform effort must recognize that independent contractors are necessary, productive participants in the construction industry and their ability to contribute to the marketplace must be preserved.