Gig Economy May See Tougher Contractor Rule After Court Victory

A legal win on an independent contractor rule for Uber Technologies Inc., Lyft Inc. and other gig economy companies may wind up sparking a regulatory defeat, as the Biden administration eyes a new approach.

Judge Marcia Crone of the U.S. District Court for the Eastern District of Texas ruled March 14 that the Department of Labor’s move to rescind a business-friendly Trump-era rule on worker classification violated government rulemaking procedures. Although the decision favored employers, it could spur the agency to develop a new independent contractor rule that cements a more pro-worker standard.

“The district court decision is both ...