Employee or Independent Contractor Classification Under the Fair Labor Standards Act
Summary
SIFMA provided comments to the U.S. Department of Labor (DOL) on the Department of Labor’s proposal to modify Wage and Hour Division regulations to revise its analysis for determining employee or independent contractor classification under the Fair Labors Standards Act (FLSA).
Excerpt
December 12, 2022
Division of Regulations, Legislation and Interpretation
Wage and Hour Division
US Department of Labor
Room S-3502
200 Constitution Ave., NW
Washington, DC 20210
Re: RIN 1235-AA43; Employee or Independent Contractor Classification Under the Fair Labor Standards Act
Dear Secretary Walsh,
The Securities Industry Financial Markets Association1 appreciates the opportunity to comment on the Department of Labor’s proposal to modify Wage and Hour Division regulations to revise its analysis for determining employee or independent contractor classification under the Fair Labors Standards Act (FLSA).2 Independent contractors have long been an important part of the securities industry, and though we appreciate that this proposal will allow our members who choose to be independent contractors to continue to be able to do so, we believe the proposal could benefit from some improvement to best serve the public interest.
I. Executive Summary
The Department’s proposal is intended to put into regulation an analysis for determining independent contractor versus employee status. While the last administration put in place a regulation which this Administration is now revising, previously there was only sub-regulatory guidance to assist businesses and individuals to determine worker classification. We welcome this opportunity to share with the Wage and Hour Division some perspective on the securities industry usage of the independent contractor model, as well as to suggest some revisions to improve the proposal.
1 SIFMA is the leading trade association for broker-dealers, investment banks and asset managers operating in the U.S. and global capital markets. On behalf of our industry’s one million employees, we advocate on legislation, regulation and business policy affecting retail and institutional investors, equity and fixed income markets and related products and services. We serve as an industry coordinating body to promote fair and orderly markets, informed regulatory compliance, and efficient market operations and resiliency. We also provide a forum for industry policy and professional development. SIFMA, with office in New York and Washington, DC, is the US regional member of the Global Financial Markets Association (GFMA). For more information, visit http://www.sifma.org
2 87 Federal Register 197 (October 13, 2022); See also, SIFMA Comment to the Department of Labor on Independent Contractor Status Under the Fair Labor Standards Act (RIN 1235-AA34)(October 26, 2020)