Dive Brief:
A federal judge dismissed a New Mexico trucking company’s request on Thursday to block the U.S. Department of Labor’s (DOL) independent contractor final rule for 2024. This decision represents a significant regulatory win for the Biden administration as it nears the end of its term.
In the case Colt & Joe Trucking, LLC v. U.S. Department of Labor, the plaintiffs claimed that the DOL’s new rule forced them to terminate one of their four independent owner-operator drivers, leaving them unable to find a replacement. In their complaint filed in May 2024, they also contended that the DOL lacked the authority to implement the rule, which they characterized as arbitrary, capricious, and unconstitutional.
Judge Kea Riggs ruled in favor of the DOL, stating that the plaintiffs did not demonstrate any actual injury caused by the rule, which indicated that they did not have standing to pursue the case. Riggs also dismissed the plaintiffs’ statutory and constitutional arguments, noting they had improperly represented their claims concerning due process violations and the Regulatory Flexibility Act.
Dive Insight:
The DOL’s rule has successfully withstood various legal challenges thus far. Judge Riggs’ ruling aligns with a similar decision from a Georgia federal judge, who dismissed a challenge from a group of freelance writers and editors last October. The plaintiffs in the case, Warren v. U.S. Department of Labor, have since appealed to the 11th U.S. Circuit Court of Appeals.
In another instance, Louisiana transportation workers who sought temporary restraining orders and preliminary injunctions against the rule were unsuccessful; a judge denied both requests in the case Frisard’s Transportation v. U.S. Department of Labor. The plaintiffs have appealed, and oral arguments are scheduled for February in the 5th Circuit.
Additionally, a protracted legal battle continues with the Coalition for Workforce Innovation v. Su, which pertains to the DOL’s shift from the previous independent contractor classification standard to the one proposed in the 2024 final rule. This case is still active.
The final rule, announced over a year ago, aims to enhance the wage-and-hour protections under the Fair Labor Standards Act for workers misclassified as independent contractors. It introduces a “totality-of-the-circumstances” approach to properly classify workers.
The plaintiffs in Colt & Joe Trucking argued that they had taken measures to prevent litigation due to the rule. However, Riggs concluded that these claims did not provide standing since they were generalized assumptions rather than specific facts. Riggs also affirmed that the DOL acted lawfully and appropriately considered the impact on those being regulated when implementing the final rule.
