

"Misclassification deprives workers of their federal labor protections, including their right to be paid their full, legally earned wages," Walsh said. Labor Secretary Marty Walsh in a statement said businesses often misclassify vulnerable workers. Millions of Americans are working "gig" jobs and this labor has become vital to some transportation, restaurant, construction, health care and other industries. Most federal and state labor laws, such as those requiring a minimum wage and overtime pay, only apply to a company's employees, who can cost companies up to 30% more than independent contractors, studies suggest. The Labor Department said it will consider the worker's "opportunity for profit or loss, investment, permanency, the degree of control by the employer over the worker, (and) whether the work is an integral part of the employer’s business," among other factors. The final rule is expected next year, after a 45-day public comment period that begins Thursday. It could have wide-ranging impacts on company profits and hiring, household incomes and worker quality of life. The proposal would require that workers be considered employees, entitled to more benefits and legal protections than contractors, when they are "economically dependent" on a company. Gig company stocks were hammered by the news, with Uber (UBER.N), Lyft (LYFT.O) and DoorDash (DASH.N) all falling at least 10%. Department of Labor rule proposed Tuesday would make it more difficult for companies to treat workers as independent contractors, a change that is expected to shake up ride-hailing, delivery and other industries that rely on gig workers.
