On the other hand, workers who are economically dependent on the employer, regardless of skill level, are employees covered by the FLSA.  In other words, they will examine whether the worker is really in business for him or herself (and thus is an independent contractor) or is economically dependent on the employer (and thus is its employee). The IRS does not follow the same rules as the DOL, where they focus primarily on the employer control of the individual, which are summarized in the old 20 Factor Test.  An individual is an employee if not an independent contractor if  they perform services that can be controlled by an employer (what will be done and how it will be done). This applies even if the individual is given freedom of action.  What matters is that the employer has the legal right to control the details of how the services are performed. Keep in mind that both the DOL and IRS agree that misclassification as independent contractors is common and a top enforcement priority. Because the rules have changed, you should review all independent contractor classifications in light of this new guidance.