The new regulation proposed by the U.S. Department of Labor (DOL) concludes that workers should be considered an employee rather than an independent contractor. This proposal is tremendously concerning for the 1099 business community and other independent contractors.
The concept of working as an independent contractor has been around for centuries. In recent years, new technology has allowed millions of Americans to earn money, work flexible hours and be their own boss through independent contracting. Workers looking to earn additional income have benefited from this type of work.
More traditional businesses like insurance, transportation, logistics, technology, and journalism also use the independent contractor model to one degree or another. The “traditional” employment model, where the employer controls where, when, and how a person can work, isn’t a good fit for every worker or every business.
Unfortunately, some states are working to pass new restrictions on independent contracting. Through laws like AB-5 in California, legislators threaten to close off the opportunities offered by independent contracting and smother new business models that benefit workers and consumers.