DOL Introduces Four-Part ‘Joint Employer’ Standard

The U.S. Department of Labor recently announced a proposal for determining when a company using contract or temporary labor qualifies as a “joint employer” under U.S. law.

Under the Fair Labor Standards Act (FLSA) employers are required to pay nonexempt employees at least the federal minimum wage, plus overtime when an employee exceeds 40 hours in a workweek. “Although the FLSA does not use the term ‘joint employer,’ the act contemplates situations where additional persons are jointly and severally liable with the employer for the employee’s wages due under the act,” the proposed rule states.

While not yet published in the Federal Register, once it is, business operators and others will have 60 days to file comments.

The four factors identified in the DOL proposal for determining when a company is a joint employer includes situations where the employer has the power to:

• Hire or fire the employee
• Supervise and control the employee’s work schedules or conditions of employment
• Determine the employee’s rate and method of payment
• Maintain the employee’s employment record

For more information on the proposal, as well as a separate National Labor Relations Board (NLRB) proposal on joint employers issued last September, TRSA members should contact TRSA Vice President of Government Relations Kevin Schwalb at kschwalb@trsa.org.

The NLRB proposal would define a company as a joint employer of another company’s staff in cases where it “possesses and exercises substantial, direct and immediate control over the essential terms and conditions of employment and has done so in a manner that is not limited and routine.” Click here for details.