One Year of the Independent Contractor Rule: What Registries Learned

The DOL's updated independent contractor rule took effect in March 2024. More than a year later, it is worth stepping back and looking at what has actually happened — and what it means for caregiver registries going into the rest of 2026.

The Independent Contractor Rule: What You Need to Know

A Quick Recap of the Rule

The 2024 rule replaced a Trump-era version that had made it somewhat easier to classify workers as independent contractors. The new rule brought back a broader, multi-factor analysis for determining worker status — often called the “economic reality” test.

The six factors the DOL looks at:

• Opportunity for profit or loss
• Investment in equipment or materials
• Permanency of the work relationship
• Nature and degree of control over the work
• Whether the work is integral to the employer’s business
• Skill and initiative required

No single factor is automatic. The DOL weighs all of them together. For caregiver registries, that means the analysis is nuanced — and documentation matters more than ever.

What Has Happened Since the Rule Took Effect

The rule created significant concern in the home care industry when it was announced. Over the past year, enforcement has been more targeted than widespread — focused primarily on industries where misclassification is most clear-cut, like gig delivery and construction.

That said, home care has not been off the radar. The DOL has continued to investigate wage complaints in the sector. Registries that blur the line between referral and direction — setting rates, controlling availability, directing the scope of care — remain the most exposed.

One consistent finding from registries that have been through investigations: the outcome depends heavily on documentation, not just intent. Registries that could show clean payment trails, caregiver contracts that reflected actual independence, and visit records that demonstrated caregiver autonomy fared far better than those that could not.

What Registries Should Take From This

The rule did not change what a well-run registry already does. If your caregivers set their own rates, choose their clients, and control their work — and if your records show that — the multi-factor test works in your favor, not against you.

The risk is in the gaps. Registries that manually process payments, use informal agreements, or have inconsistent visit records are the ones most exposed if an investigation starts.

1099 accuracy matters more now. The rule reinforced that independent contractor status has to reflect the actual working relationship. A 1099 filed for a worker who was functionally an employee does not protect you — it documents the problem.

How to File a 1099 for a Caregiver

What to Do Now

If you have not reviewed your caregiver contracts and operating practices since the rule took effect, now is a good time. Specific things worth looking at:

• Are your contracts current and reviewed by legal counsel familiar with the registry model?
• Do your payment records show the client paying the platform, not your registry paying caregivers?
• Are your visit logs consistent, complete, and easy to pull on short notice?
• Do your job ads and client-facing materials describe your registry’s role accurately?

Ally is built to make the documentation side of this automatic. If you want to talk through what that looks like, we are happy to help.

Talk to Ally

Why Would the DOL Call My Registry?