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A bicameral GOP resolution to block the Department of Labor’s (DOL’s) now-final worker classification rule has been introduced. On March 21, the House Education and the Workforce Committee approved a Congressional Review Act (CRA) motion to block the rule.

A House vote on the CRA resolution is expected later this month. Senate action on the CRA motion is also expected.

The CRA resolution, H.J. Res. 116, if enacted into law, would not only stop the worker classification rule, but also it would prevent DOL from promulgating any substantially similar new rule. The Congressional Review Act provides for both expedited action and a simple majority vote (i.e., 51 rather than 60 in the Senate) on resolutions brought under its authority. This CRA resolution was introduced on March 6 by Sen. Bill Cassidy (R-LA) in the Senate and by Rep. Kevin Kiley (R-CA) in the House.

The DOL worker classification regulation, which took effect March 11, states that a worker’s status as an employee or an independent contractor will be determined by an “economic reality” test. Economic reality will be determined on a facts-and-circumstances basis that will assess a worker’s economic dependence on the entity for which the worker is performing work. Six specific factors will be used in doing this analysis. All will be given equal weight in making a final determination. The six factors—each of which is discussed in detail in the final rule—include control exerted by the entity for which the work is performed (or, by the worker doing the work), the opportunity for the worker to experience profit or loss, the worker’s investment in the business, the permanency (which factor includes exclusivity) of the work-hired vs work-performed, and the skill and initiative demonstrated by the worker.

 Prospects: While it is possible that there are the votes in both the House and Senate to block the worker classification rule, it is unlikely the effort will succeed. Even if Congress passes the blocking resolution, President Biden is sure to veto it. And at this juncture it does not look like there are enough votes to override a veto.

NAIFA Staff Contacts: Michael Hedge – Senior Director – Government Relations, at mhedge@naifa.org; or Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org.