If your business relies on contracted labor — farm labor crews, delivery drivers, subcontracted maintenance staff, or seasonal hospitality workers — a rule moving through the Department of Labor right now could change how those workers are classified under federal law.
It hasn’t taken effect yet, but employers across Florida, Georgia, North Carolina, and Texas should understand it before it does.
What the DOL Is Proposing
On February 26, 2026, the DOL published a Notice of Proposed Rulemaking to rescind the 2024 independent contractor rule and replace it with a version closer to the framework the agency used in 2021. The public comment period closed April 28, 2026, and a final rule is expected later this year. Nothing has changed yet — but employers who wait until it’s final to review their contractor relationships will be starting from behind.
The proposed rule keeps the same six-factor “economic reality” test used since 2021, but it gives two factors more weight than the rest:
- The nature and degree of control the business has over how the work gets done.
- The worker’s opportunity for profit or loss based on their own initiative or investment — not on the employer’s decisions.
Under the 2024 rule, all six factors were weighed equally, with no single factor controlling the outcome. The proposed rule moves back toward a framework where these two core factors carry more weight — in most cases easier for a genuinely independent contractor relationship to satisfy, but only if the relationship is actually structured that way in practice, not just on paper.
The Part Agricultural and Seasonal Employers Shouldn’t Miss
Most coverage of this rule is written for gig-economy platforms and general FLSA employers. It’s missing the detail that matters most for the South’s agricultural and seasonal workforce: the DOL is proposing to apply the same classification test to the Migrant and Seasonal Agricultural Worker Protection Act (MSPA), not just the FLSA. Right now, MSPA and FLSA can apply slightly different lenses to the same relationship. If finalized, agricultural employers, farm labor contractors, and staffing agencies serving the H-2A workforce would be classifying workers under one uniform federal standard instead of two. The DOL also proposes extending the same test to the FMLA.
For H-2A employers specifically, this matters because misclassification exposure under MSPA carries its own penalty structure, separate from FLSA back-wage liability — and a uniform standard could close (or in some cases newly open) gaps that farm labor contractors have historically relied on.
What to Do While the Rule Is Still Proposed
You don’t need to overhaul contractor relationships today, but a February 2026 proposal with an April 2026 comment period closed and a final rule “expected later this year” is not a reason to wait until it’s final either. Worth doing now:
- Inventory who you currently classify as an independent contractor — farm labor crews, owner-operator drivers, subcontracted grounds or maintenance crews, per-diem hospitality staff — and note how much day-to-day control your business exercises over each one.
- Look specifically at the two core factors. Does the worker set their own schedule, supply their own equipment, and take on real financial risk independent of your decisions? Or does your business direct the how, when, and where of the work?
- Flag any MSPA-covered relationships (agricultural, H-2A, or farm labor contractor arrangements) for a second look once the final rule publishes, since that’s the area with the least existing guidance.
- Don’t restructure based on the proposal alone. The final rule could shift in either direction based on comments received; changing worker classifications now, only to change them again later, creates its own paper trail and audit risk.
Southern Employers Have More at Stake Than the National Headlines Suggest
Florida, Georgia, North Carolina, and Texas together account for a large share of the country’s H-2A agricultural workforce and seasonal hospitality and construction labor. A federal classification standard shift that most outlets are covering as a gig-economy story is, for this region, really a farm labor and seasonal staffing story. Getting ahead of it — before the final rule, not after a DOL investigator asks about it — is the cheaper path.
Disclaimer: This article is provided for general informational purposes only and does not constitute legal advice. Wage and hour laws vary by state and change frequently. Consult a qualified professional regarding your specific situation before making compliance decisions.