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The Biden administration implemented a new rule on Tuesday that will tighten standards for when “gig economy” workers at companies like Uber, Lyft, and Grubhub must be considered employees who are entitled to labor protections rather than independent contractors.
The Labor Department finalized a new rule that will replace a Trump-era standard that narrowed the criteria for classifying workers as employees under the Fair Labor Standards Act.
“Misclassifying employees as independent contractors is a serious issue that deprives workers of basic rights and protections,” acting Secretary of Labor Julie Su said in a press statement. “This rule will help protect workers, especially those facing the greatest risk of exploitation, by making sure they are classified properly and that they receive the wages they’ve earned.”