Federal Action
At the U.S. Department of Labor in Washington, D.C., two new developments could affect independent contractors.
Editor’s Note: The U.S. Department of Labor is currently facing five lawsuits over the Biden-Harris administration’s independent-contractor rule. I am a plaintiff in one of those cases.
Late last week, there were two developments at the U.S. Department of Labor that could affect independent contractors.
The first development had been expected for months, ever since the newly staffed Labor Department under President Trump announced its intent to rescind the independent-contractor rule that the Biden administration finalized in 2024.
Last week, the Labor Department advanced a proposal in this policy area, according to information that became publicly available online through the White House Office of Information and Regulatory Affairs.
Here is how the team at the Littler law firm described this development:
“The White House Office of Information and Regulatory Affairs (OIRA) yesterday received a proposed rule from the U.S. Department of Labor’s Wage and Hour Division (WHD) relating to employee or independent contractor status under the Fair Labor Standards Act (FLSA), Family and Medical Leave Act (FMLA), and Migrant and Seasonal Agricultural Worker Protection Act (MSAWPA). It is unclear if this proposal is simply a rescission of the Biden administration rule; a rescission of the Biden rule and replacement with a rule from first Trump administration; or something else entirely. Assuming OIRA has no significant changes, the Department can then move ahead and publish the proposed rule. OIRA’s review time can vary widely, but if this proposal is a rescission and/or rescind and replace with a prior Trump rule, we may see a proposed rule for public comment in the near future.”
Several publications, including Bloomberg Law and HR Dive, also reported on this development. HR Dive summed up the situation by writing that “details on the upcoming proposal are scant.”
We’re all going to have to wait and see the content of this proposed rule together.
Internal Investigation
The second headline last week about the U.S. Labor Department that could affect independent contractors came from the New York Post:
The Post reported that U.S. Labor Secretary Lori Chavez-DeRemer “is under an internal investigation following an explosive complaint alleging she’s been ‘abusing her position’ by pursuing an ‘inappropriate’ relationship with a subordinate.”
Chavez-DeRemer, who was and still is backed by the Teamsters union, was a controversial choice for the Labor Secretary position from the start.
Among other things, she had voted during her time in Congress to support the Protecting the Right to Organize Act, a federal bill that would have injected California’s disastrous independent-contractor language into labor law nationwide.
When President Trump nominated Chavez-DeRemer in late 2024, attorneys at Fisher Phillips wrote:
“Her selection was met by skepticism by some in the employer community because she was one of only three Republicans to co-sponsor the controversial PRO Act this past July, a bill containing a proverbial wish list of pro-union initiatives. The fact that the Teamsters President publicly supported Chavez-DeRemer’s nomination last week further casts her as an outside-the-lines pick.”
Her nomination raised even more questions, including from me, after several senators at Chavez-DeRemer’s February 2025 hearing before the U.S. Senate HELP Committee asked if she still supported the PRO Act.
This was her reply to Senator Bill Cassidy, R-Louisiana, about the PRO Act:
This was her reply to Senator Rand Paul, R-Kentucky, about the PRO Act:
Senator Cassidy also asked Chavez DeRemer specifically about independent-contractor policy.
This was her reply to Senator Cassidy on that question:
Ultimately, the U.S. Senate confirmed Chavez-DeRemer to serve as U.S. Labor Secretary.
The New York Post story published last week describes a complaint now filed about Chavez-DeRemer with the Department of Labor’s Office of Inspector General. The Post story cites an “alleged paramour” and then goes on to state:
“The former Oregon congresswoman is also accused of drinking in her office during the workday and committing ‘travel fraud’ by having her chief of staff and deputy chief of staff ‘make up’ official trips to destinations where Chavez-DeRemer can spend time with family or friends on the taxpayers’ dime.
“White House spokeswoman Taylor Rogers called the allegations ‘baseless.’”
On Saturday, the Daily Beast published a story that included this information:
“In addition to Chavez-DeRemer, her chief of staff Jihun Han and deputy chief of staff Rebecca Wright are also under investigation, with the complaint alleging that both Han and Wright had knowledge of these issues.”
Nobody, to the best of my knowledge, is currently calling for the removal of Chavez-DeRemer as U.S. Labor Secretary.
However, should the investigation ultimately lead to her stepping down or being removed, the question would become who takes charge of the U.S. Labor Department and whether that person has a different background when it comes to independent-contractor policy.
The Deputy Secretary
The current Deputy U.S. Labor Secretary is Keith Sonderling, who has a strong track record of supporting independent contractors.
Back in 2019, during the Trump-Pence administration, Sonderling issued a 10-page opinion letter that provided guidance for gig technology companies about working with individuals as independent contractors.
At Sonderling’s February 2025 hearing about his nomination to serve as Deputy U.S. Labor Secretary, Senator Cassidy asked him directly about independent-contractor policy.
This was Sonderling’s reply:
And in June 2025, Sonderling wrote an op-ed in the Washington Examiner that called California’s Assembly Bill 5 “catastrophic”:
“Look at California’s catastrophic Assembly Bill 5, which tried to reclassify most independent contractors as employees. Instead of improving livelihoods, it triggered chaos. Freelancers across media, transportation, tech, and the arts lost contracts overnight. Self-employment rates cratered. Only after a voter revolt and economic fallout did lawmakers scramble to undo the damage, carving out one exemption after another — a slow-motion admission that they had gone too far.”
As with last week’s development regarding the independent-contractor rule, when it comes to the investigation into Chavez-DeRemer and how it might play out, we are all going to have to wait and see what happens next.
Thank you Kim for your posts. Hope you were able to enjoy your Holidays into the New Year, 2026. Great to read the new developments. You always deliver a clear and simple message.