The Gig Economy: New Labor Rule Affects Older Freelancers
Vivian Marlene Dunbar, Lila Stromer, and Roger Baumgarten are just a few examples of older Americans who have turned to freelance work to supplement their income and enjoy the flexibility that comes with being an independent contractor. According to AARP, over a quarter of older workers participate in freelance or gig work, allowing them to work on their own terms without being tied down to a traditional job.
However, a new Department of Labor rule that went into effect in March has raised concerns among these freelancers, as it may limit the opportunities available to them, potentially impacting their income as they approach retirement. The rule includes a six-factor test for companies to determine worker classification as either an employee or an independent contractor, with the aim of preventing worker misclassification and ensuring that workers receive the benefits and protections they are entitled to.
While worker misclassification has historically been an issue, the new rule is designed to address these concerns and protect vulnerable workers who may be exploited by companies looking to save money by classifying them as contractors rather than employees. The rule also aims to uphold minimum wage and overtime pay standards for workers in various industries, such as in-home caregivers and construction workers.
Despite the intention behind the new rule, some fear that it may unintentionally limit opportunities for legitimate independent contractors, including older Americans who rely on freelance work for income. Surveys suggest that the majority of independent contractors prefer their flexible work arrangements, and the new rule could potentially disrupt their ability to continue working as independent contractors.
The implications of the new labor rule extend beyond just older freelancers, as it may impact various industries and workers who rely on independent contracting for their livelihood. The rule could lead to a decrease in self-employment opportunities, especially for women and older Americans who seek out flexible work arrangements as they near retirement.
In response to the new rule, independent contractors across different professions have filed lawsuits challenging its implementation, expressing concerns about the potential negative impact on their businesses and livelihoods. Freelancers like Kim Kavin, who leads a coalition of freelance workers advocating for their rights, worry about the consequences of the rule on their ability to continue working as independent contractors.
As the gig economy continues to evolve, it remains to be seen how the new labor rule will shape the future of freelance work for older Americans and workers across various industries. For now, freelancers like Dunbar, Stromer, and Baumgarten continue to navigate the changing landscape of independent contracting, balancing the benefits of flexibility with the challenges of regulatory changes in the labor market.
