The Direct Selling Association (DSA) said it “welcomes” the recent announcement from the US Department of Labor proposing a rule that would clarify the distinction between employees and independent contractors. A 2024 rule previously made it harder for companies to classify workers as contractors, requiring them to offer benefits like insurance, minimum wage, overtime and other costly benefits.
The DSA stated this new proposal would “rescind the Department’s 2024 independent contractor regulation and restore an analysis grounded in economic reality and longstanding principles recognized by federal courts.”
The direct selling industry has long been a viable entrepreneurial pathway for Americans to pursue financial and occupational independence, and contractor status, the DSA says, is key to allowing direct sellers full discretion over their level of participation in the marketplace.
“The Department of Labor’s proposed rule reinforces a fundamental distinction that has long defined direct selling: individuals choose to pursue building independent businesses on their own terms,” said Dave Grimaldi, Direct Selling Association CEO. “Direct sellers are not assigned work or directed in the manner of employees. They decide whether, when and how to engage, and their success is driven by their own initiative. Clear and consistent standards grounded in economic reality help ensure that millions of American direct sellers can continue to operate independently, with the autonomy that defines our business model.”
The DSA called the new proposal “an important step toward reinforcing clarity and predictability for direct selling,” and that regulatory frameworks should accurately reflect how direct sellers operate while enabling companies to maintain compliance with federal law.
“Direct selling is a well-established component of the American economy, supporting millions of individuals who value the ability to pursue entrepreneurship with minimal barriers to entry and complete control over how they engage,” the DSA wrote in a statement. “DSA looks forward to continued engagement with the Department of Labor and federal policymakers throughout the rulemaking process.”
