A federal judge ruled against a New Mexico trucking company’s motion to block the U.S. Department of Labor’s (DOL) 2024 independent contractor final rule, granting a regulatory win to the Biden administration.

In the case of Colt & Joe Trucking, LLC v. U.S. Department of Labor, the plaintiffs argued that the new rule forced them to end the employment of one of their independent owner-operator drivers and left them unable to hire a replacement. They also contended that the DOL lacked the legal authority to issue the rule, which they described as arbitrary, capricious, and unconstitutional.

However, Judge Kea Riggs ruled in favor of the DOL, determining that the plaintiffs failed to demonstrate that they were harmed by the rule, which meant they lacked standing to bring the lawsuit. The judge also dismissed the plaintiffs' constitutional and statutory claims, noting that their arguments regarding due process and the Regulatory Flexibility Act were "improperly briefed."

Legal Context and Industry Reactions

‍This decision follows similar legal battles where the DOL’s rule has prevailed. In October 2024, a Georgia federal judge dismissed a similar challenge from freelance writers and editors. Those plaintiffs have since appealed to the 11th U.S. Circuit Court of Appeals.

Another challenge in Louisiana, brought by transportation workers, also failed when a judge denied their motions for a temporary restraining order and preliminary injunction. This case, Frisard’s Transportation v. U.S. Department of Labor, is being appealed to the 5th Circuit, with oral arguments scheduled for February.

Meanwhile, the ongoing case Coalition for Workforce Innovation v. Su continues the fight against the Biden administration’s shift in independent contractor standards.

Key Elements of the 2024 Rule

‍Announced over a year ago, the 2024 final rule aims to extend wage-and-hour protections under the Fair Labor Standards Act (FLSA) to workers misclassified as independent contractors. The rule uses a “totality-of-the-circumstances” framework to determine if a worker should be classified as an independent contractor.

The plaintiffs in Colt & Joe Trucking claimed they had made efforts to avoid litigation due to the new rule, but Judge Riggs dismissed these claims as speculative, not supported by specific facts. Additionally, Riggs ruled that DOL had appropriately considered the cost impact of the rule on regulated parties when implementing it.

The DOL’s rule remains under legal scrutiny, but its validity has held up in multiple court challenges thus far.