The Department of Labor on January 7, 2021 posted a final rule regarding the classification of so-called “gig contractors.” The final rule is set to take effect on March 8, 2021. A big question mark looms over whether this rule will actually take effect. The incoming Biden administration, as most incoming administrations have done, intends to freeze all pending regulations which have yet to take effect.
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HUBZone Program: SBA’s Proposed Rule Clears Up Some Common Misconceptions
Last week, the SBA released a proposal to overhaul the HUBZone Program. The proposed rule will make major changes to almost all aspects of the HUBZone Program, and my colleagues are covering those changes in a series of two posts on SmallGovCon.
But while the proposed HUBZone Program rule changes will garner most of the headlines, the SBA also has used the proposed rule as an opportunity to clear up a few very common HUBZone Program misconceptions–such as the notion that so-called “jobsite employees” don’t count toward the 35% HUBZone residency requirement.
Here are three of the most important clarifications SBA offered in the proposed HUBZone rule.
SBA: Independent Contractors Are Subcontractors
A 1099 independent contractor is a subcontractor–not an employee.
This guidance comes from the SBA’s major new rule on the limitations on subcontracting, in which the SBA responded to public questions about how independent contractors are to be treated.
Limitations On Subcontracting: 1099 Contractor’s Work Didn’t Count
Under the FAR’s limitations on subcontracting clause, the work to be performed by a 1099 independent contractor did not count toward the prime contractor’s performance.
In a recent bid protest decision, the GAO held that a procuring agency properly rejected an offeror’s proposal because the offeror was relying, in part, on an independent contractor to meet its obligations under the limitations on subcontracting clause.