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The Freelancer Rules Just Changed Again. Does It Serve Everyone?
Whether you hire contractors or work as one, independent contractor classification is something every solo and micro business owner needs to understand. The DOL independent contractor rule has changed three times in five years, and the 2026 proposed rule makes it easier to classify someone as an independent contractor. Easier compliance sounds like good news. But easier for whom?
This is also a conscious business question, one about values, not just compliance. And for New Hampshire's growing community of solo and micro business owners, it lands close to home.
What Has Actually Changed Since 2021
In 2021, the DOL rule focused on two core factors above all others: the nature and degree of control over the work, and the individual's opportunity for profit and loss. Three additional factors carried less weight.
In 2024, the Biden administration replaced it with a six-factor totality test where no single factor outweighed the others. The test looked at the whole picture of the working relationship, making independent contractor classification harder and more nuanced.
In 2025, the DOL stopped enforcing the 2024 rule and reverted to older 2008 guidance while the policy debate continued.
In February 2026, a new proposed rule reinstated the 2021 framework. The public comment period is open until April 28, 2026.
Every version of this rule makes a quiet argument about the work relationship, about who bears the risk, who captures the value, and how much visibility the law gives to the party with less leverage. What gets added, removed, or reweighted in each revision shifts that argument in ways that outlast any single administration.
Who Is Actually Seeking Independent Work and Why
Before looking at how the rule plays out in practice, it helps to understand who is living under it.
Since 2020, the independent workforce has grown by 90%, reaching 27.7 million full-time independents by 2024. The shift was not a lifestyle trend. It was a response to a sequence of institutional failures: pandemic layoffs that displaced 18 million workers overnight, a Great Resignation driven by wage stagnation, burnout, and hostile workplaces, and return-to-office mandates that pushed women and caregivers out of traditional employment at disproportionate rates. Women now represent nearly half of all new entrepreneurs, up from 29% before the pandemic. For many, especially women and workers of color, independent work was not a first choice. It was a rational exit from systems that were not working for them.
Three Scenarios: Same Relationship, Different Rules
Maya, Brand Strategist. Maya left her corporate marketing job in 2022 after a return-to-office mandate. One client, a regional healthcare company, accounts for 60% of her monthly income. She attends their weekly Zoom calls, uses their project management software, follows their brand guidelines, and invoices monthly.
Under the 2024 rule, the totality test would likely find her misclassified. One client dominates her income. The company controls the cadence, tools, and deadlines. Her work is integral to their marketing function. The company would face back liability, and Maya would gain FLSA and FMLA protections retroactively, including the right to leave she never took when her mother had surgery.
Under the 2026 rule, she sets her own hours, owns her equipment, and invoices as a business. The surface conditions of independence are present. The relationship would likely read as legitimate independent contracting. No back liability for the company. No FLSA or FMLA floor for Maya.
Carlos, Seasonal Landscaper. Carlos runs a two-person operation hired spring through fall by a property management company. The company controls which properties he services, when, and with which suppliers. He brings his own equipment but the schedule fills his weeks.
Under the 2024 rule, the finding would likely be an employee relationship. The company owes him overtime for peak season weeks. Written disclosure of work terms would be required.
Under the 2026 rule, he brings his own equipment, operates under his own business name, and could theoretically serve other clients. The likely finding is independent contractor. The overtime goes uncompensated. If he is injured on a property, workers comp does not apply.
Diane, Fractional CFO. Diane is 52, serves four small businesses on retainer, sets her own rates, chooses her own tools, and turns down clients she does not want. Her income is genuinely distributed. She built this deliberately after 20 years in corporate finance.
The finding is the same under both rules: legitimate independent contractor. Her independence is structural and real, and both frameworks recognize it.
Diane is protected under both rules because her working life matches her label. Maya and Carlos are the ones the independent contractor rule change actually affects. What they share is a dominant client relationship that functions economically like employment, without the protections employment provides.
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Nobody's Working From the Same Dictionary
The independent contractor rule has changed three times in five years not just because of politics, but because the people in this debate are not arguing about the same things. The words they are using do not mean the same things.
"Independent" legally means not economically dependent on a single employer. In practice it often just means alone, no benefits, no collective, no safety net. The word makes a structural vulnerability sound like a personal achievement.
"Flexibility" is what businesses use to describe scaling labor costs up and down, and what workers use to describe setting their own hours. Same word. Different transaction entirely.
"Control" is what legal tests hinge on, yet a business and a contractor in the same working relationship will describe it in completely opposite terms. The client sets the deadline, the format, the tools, and the revision process and genuinely believes they are not controlling the work.
When language is not shared, the party with the better lawyer gets to define the terms when it counts. That is not a glitch in the system. For some, it is the point.
What the 2026 Rule Change Actually Means Practically
The new independent contractor rule makes it easier to call someone a contractor. The test is narrower, the bar is lower, and if the basic surface conditions of independence are present, the federal standard will likely read the relationship that way.
But relief has fine print.
The 2024 rule has not been formally repealed. Until the new rule is finalized, it still lives in the courtroom. A contractor who believes they were misclassified can still bring a misclassification claim under the old standard in private litigation. The rule changed. The risk did not disappear.
Federal flexibility also does not travel. California, Massachusetts, New Jersey, and other states running stricter ABC tests set their own floor regardless of what Washington does.
A note for New Hampshire business owners specifically: New Hampshire follows the federal economic reality test rather than a stricter state standard, which means the 2026 rule change has a more direct impact here than across the border in Massachusetts. That proximity cuts both ways. Contractors in New Hampshire have less state-level protection to fall back on when federal rules loosen. Businesses hiring contractors here are operating with fewer guardrails than their neighbors to the south. Knowing that is part of knowing your position.
And permissive rules do not protect everyone equally. When a dispute lands in front of a lawyer, the rule is only as useful as your ability to argue it. What a classification rule measures, it protects. What it does not measure, it leaves to whoever holds more power in the relationship.
Know your state. Know your contracts. Talk to an employment attorney before the question becomes urgent.
This is not legal advice. It is an invitation to pay attention.
What To Do Right Now
Start with your values. If you are not sure where to start, that is a reasonable place to be. Mapping the full arc of your working relationships, from how work comes in to how it gets delivered and paid, can surface assumptions you did not know you were carrying. That kind of clarity is worth building before the next rule change arrives.
If you hire contractors: Step back and look at the whole picture. Where does risk live in the arrangement? Where does the reward? Are those proportionate to what each party is bringing and absorbing? Get written contracts in place covering scope, payment, deadlines, intellectual property, and termination. Audit your current relationships for clarity, not cover. Know your state standard. Look honestly at who is absorbing the cost of taxes, equipment, and income uncertainty in your contractor relationships. If the answer is always the contractor, that is worth examining regardless of what the rule permits.
If you are the contractor: You are not just a service provider navigating a rule change. You are running a business. Know your value before you enter any negotiation, not what the market bears when everyone is undercutting each other, but what your work is actually worth factoring in expertise, overhead, taxes, and the benefits you are carrying alone. Price from that number. Not from fear of losing the work.
Underpricing does not just affect you. It compresses rates across your field and makes it harder for everyone to hold a sustainable floor. Your pricing is a values practice.
Document your independence actively. Evaluate your boundaries regularly. Notice the quiet ways independence erodes, absorbing extra revision rounds, attending meetings outside scope, adjusting rates to keep a client comfortable. Name them before they become the norm. Get everything in writing. And submit a public comment before April 28. The conversations being had about your work are happening largely without your voice. That is worth changing.
The Questions Are Older Than the Rule
The same flexibility that drew people into independent work is often the mechanism that removes their access to the protections designed to support them. Seeing that clearly is the beginning of deciding whether to replicate it or do something different.
Conscious business does not require perfection. It requires honesty. About what your arrangements actually look like from the other side of the table. About who absorbs the uncertainty in your working relationships. About whether the language you use to describe your practices matches the reality both parties are living.
The most stable thing in a shifting policy landscape is not a classification test. It is knowing what your values actually require of you and building your practices around that consistently, even when the rules would let you do otherwise.
That work does not have a comment period deadline.
Working with Collective Agency:
If this piece raised questions you want to think through with support, we work directly with solo and micro business owners in New Hampshire and beyond.
Client Journey Mapping helps you see the full picture of how work actually moves through your business, where the gaps are, where the risk lives, and where your practices may not yet match your values.
Visioning is for business owners who are ready to set intentional direction, not just respond to what the landscape hands them.
Strategic Alignment is for small teams or collaborators who need to get on the same page before working together, including business owners and the contractors they partner with regularly.
If any of those feel timely, we would love to be in conversation.
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Additional Resources:
SBA Office of Advocacy: Rule summary and public comment portal advocacy.sba.gov/2026/03/03/dol-proposes-new-independent-contractor-rule/
Freelancers Union: State by state contractor rights and resources freelancersunion.org/freelancing-in-america/
NH Small Business Development Center: Free advising for New Hampshire small business owners nhsbdc.org
SCORE New Hampshire: Free mentorship including legal and HR guidance score.org/chapter/score-new-hampshire
In Partnership,
Tricia + Chandra
Collective Agency
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