July 22, 2022
Dear Secretary Walsh and Acting Administrator Looman,
In response to the Department of Labor’s (DOL) recently announced plans to engage in rulemaking on employment status determination under the Fair Labor Standards Act (FLSA), we write to express our support for retaining the January 7, 2021 DOL rule on this matter and ask you to prioritize policies that advance self-employment opportunities in America without unwarranted government barriers.
Independent contracting and other flexible work policies are essential to the lifestyles and success of a growing community of over 59 million freelance workers in a broad range of occupations. In fact, flexibility is increasingly sought by people in more traditional work arrangements, as well. Recent surveys show that workers desire increased flexibility to work remotely, control their work hours, and pursue self-employment — not only in response to pandemic disruptions but because families have shifting needs, demands, schedules, and priorities in the 21st century.
Further, consider that 1 in 5 American workers have changed careers since the pandemic began, nearly 50 percent are considering a career change, and more than half of American workers that changed jobs in the past year entered new occupations or fields. Clearly this is an era where flexibility, including self-employment opportunities, are of tremendous importance to families, businesses, and consumers as they battle inflation, labor shortages, and supply chain disruptions, and seek additional work options despite more than 11 million job openings.
As you may be aware, an overwhelming majority of those who earn income as independent contractors are satisfied with those arrangements. The U.S. Bureau of Labor Statistics (BLS) found in a survey that 79 percent of independent contractors prefer their situation over traditional jobs and that fewer than 1 in 10 would prefer a traditional work arrangement.
Simply put, while it may benefit narrow special interest groups, rulemaking that diminishes freelance opportunities and turns independent contractors into traditional employees under federal law would be widely unpopular among the individuals it would impact most directly. As we await announcement of a proposed rule from the U.S. Wage and Hour Division, we are concerned about the intent of DOL based on continued attempts to overturn the January 7, 2021 rule that remains in effect; continued references to worker misclassification as a means to undermine independent contracting; continued prioritization of the Protecting the Right to Organize Act by President Biden that would institute the unworkable “ABC” test for employment status under the National Labor Relations Act; and past actions such as the 2015 Obama/Biden Administration guidance that elevated the use of secondary economic realities test factors to curb independent contracting – an approach we worry President Biden may pursue again.
The January 7, 2021 DOL rule has provided clarity to the decades-old economic realities test for the modern workforce, helping to apply determinations in light of the different types of work and technologies used to work and connect with customers today. Instead of removing this clear and sensible standard and attempting to diminish or eliminate independent contracting, we urge you to preserve paths to self-employment that allow tens of millions of working Americans, parents of children with special needs, workers seeking career changes, disabled workers and workers caring for disabled family members, and entrepreneurs growing small businesses of their own to pursue work on their own terms.
During your June 24 and June 29, 2022 forums, numerous independent contractors and others made clear their strong support for self-employment and the many ways independent contracting has enriched their lives. We ask that DOL not only work to protect but further improve rather than diminish these career pathways.
DOL could do so by, among other things, supporting legislation to end government-imposed barriers to businesses voluntarily providing benefits to independent contractors and providing self-employed workers more parity with other employers in acquiring health care and other benefits on their own, such as permitting voluntary access to portable benefits/health savings accounts.
At a time when American families are increasingly concerned about the economy and their careers, now is a time to advance the flexibility they seek. Reducing paths to self-employment will only reduce opportunity and growth in the 21st century.
Sincerely,
Brent Wm. Gardner
Chief Government Affairs Officer
Americans for Prosperity
F. Vincent Vernuccio
President
Institute for the American Worker
Michael J. Lotito
Co-Chair
Littler Workplace Policy Institute
Krisztina Pusok, Ph. D.
Director of Policy and Research
The American Consumer Institute
Brandon Arnold
Executive Vice President
National Taxpayers Union
Grover Norquist
President
Americans for Tax Reform
Greg Sindelar
Chief Executive Officer
Texas Public Policy Foundation
Chief Executive
Officer Alliance for Opportunity
Lisa B. Nelson
Chief Executive Officer
American Legislative Exchange Council
Andrew F. Quinlan
President
Center for Freedom and Prosperity
Robert Fellner
Vice President & Policy Director
Nevada Policy Research Institute
Heather R. Higgins
Chief Executive Officer
Independent Women’s Voice
Bethany Marcum
Chief Executive Officer
Alaska Policy Forum
Mike Stenhouse
Chief Executive Officer
Rhode Island Center for Freedom and Prosperity
Mike Hruby
President
New Jobs America
Paul Gessing
President
Rio Grande Foundation
Seton Motley
President
Less Government
Robert Alt
President & CEO
The Buckeye Institute
Steve Delie
Director, Policy and Legal Affairs
Workers for Opportunity
Brian Minnich
Executive Vice President
Freedom Foundation
Daniel Erspamer
Chief Executive Officer
Pelican Institute
Chief Executive Officer
Alliance for Opportunity
Eric Peterson
Director
Pelican Center for Technology and Innovation
Randy Hicks
President & CEO
Georgia Center for Opportunity
President & CEO
Alliance for Opportunity
Jeffrey Mazzella
President
Center for Individual Freedom
Douglas Carswell
President & CEO
Mississippi Center for Public Policy
David Williams
President
Taxpayers Protection Alliance
Ryan Ellis
President
Center for a Free Economy
Phil Kerpen
President
American Commitment
James Taylor
President
The Heartland Institute
Adam Brandon
President
FreedomWorks
Elaine Parker
President
Job Creators Network Foundation
Tarren Bragdon
President & CEO
Foundation for Government Accountability
Brandon Dutcher
Senior Vice President
Oklahoma Council of Public Affairs
Thomas A. Schatz
President
Citizens Against Government Waste
Justin Owen
President & CEO
Beacon Center of Tennessee
Matthew Kandrach
President
Consumer Action for a Strong Economy
Charles Mitchell
Chief Executive Officer
Commonwealth Foundation
Caden Rosenbaum
Policy Analyst, Tech and Innovation
Libertas Institute
James L. Martin
Founder/Chairman
60 Plus Association
Saulius “Saul” Anuzis
President
60 Plus Association