Labor Department Issues Guidance on “Joint Employers”

Interpretation may facilitate enforcement actions for labor violations tied to temporary and contract workers.

January 21, 2016

WASHINGTON – Yesterday, the U.S. Department of Labor’s Wage and Hour Division issued an interpretation of  “joint employment ” that identifies scenarios in which two or more companies jointly employ a worker and are therefore jointly liable for labor violations.

“As a result of continual changes in the structure of workplaces, the possibility that a worker is jointly employed by two or more employers has become more common in recent years. In an effort to ensure that workers receive the protections to which they are entitled and that employers understand their legal obligations, the possibility of joint employment should be regularly considered in [Fair Labor Standards Act] and [Migrant and Seasonal Agricultural Worker Protection Act] cases, particularly where (1) the employee works for two employers who are associated or related in some way with respect to the employee; or (2) the employee’s employer is an intermediary or otherwise provides labor to another employer,” wrote Wage and Hour Division Administrator David Weil.

The DOL’s interpretation of a joint employer will have a much wider impact than the earlier National Labor Relations Board standard issued last year, which now makes more businesses subject to obligations and liability under the National Labor Relations Act—particularly franchises. In fact, Administrator Weil noted that DOL’s guidance was issued in part to dispel the “misconception” that joint employment only deals with franchise relationships. DOL’s interpretation may instigate legal actions for unpaid overtime or other labor violations.

NACS is preparing a detailed analysis in the coming days of the DOL’s joint employer interpretation and its impact on the convenience and fuel retailing industry. Stay tuned to NACS Daily for an update.

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