The Harmonization of Coverage Act of 2017 has been introduced to amend the definition of employee in section 3(e)(1) of the Fair Labor Standards Act of 1938 (FLSA) and make it consistent with the definition set out in the Internal Revenue Code of 1986.
FLSA’s definition of employee is “any individual employed by an employer,” while the Internal Revenue Code of 1986 adds an employee can also refers to “an agent-driver or commission-driver engaged in distributing meat products, vegetable products, fruit products, bakery products, beverages (other than milk), or laundry or dry-cleaning services, for his principal.”
Implications for bakeries
ABA said the baking industry is a large user of independent contractors for their direct service delivery systems.
“Many bakers sell delivery routes to independent distributors, who deploy their fleet and keep stores stocked with freshly baked goods,” added ABA.
Mike Goscinski, director of government relations at ABA, said: “This legislation provides clarity for our members to continue growing relationships with entrepreneurs to produce and deliver freshly baked products.”