A federal proposal that could reclassify many independent contractors—including third-party grocery delivery drivers—as employees could threaten the business models of companies like Instacart, DoorDash and Uber Eats.

The U.S. Department of Labor on Tuesday unveiled a proposal that would be used to determine whether a worker is an independent contractor or an employee under the Fair Labor Standards Act. Employees are guaranteed a minimum wage and other benefits that don’t legally extend to contractors.

Since then, third-party food delivery has grown exponentially, aided by the pandemic and consumers’ shift to more online ordering. As delivery companies have grown, so has the pool of independent contractors who can download an app to start delivering food in their cars or on bikes.

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