Skip to main content

Labor Department Finalizes Joint Employer Rule


The Labor Department has released a final version of the joint employer rule, which makes it more difficult for businesses to be held liable when their franchisees or contractors violate the Fair Labor Standards Act.

Under this finalized joint employer rule, set to take effect on March 16, a four part test is used to determine whether a business is jointly liable for minimum wage and overtime violations.  This four part test weighs whether the business, with regard to its franchisee or contractor, maintains the power to hire and fire; to supervise schedules and 'conditions of employment'; to set pay; and to keep employment records.  Notably, businesses will not be considered joint employers by virtue of their business model alone.  As a result, franchisors will not be considered joint employers just because they are franchisors.

Now bear in mind, the National Labor Relations Board ("NLRB") is expected to finalize a similar rule that clarifies when a business should be classified as a joint employer as to collective bargaining and unfair labor practice charges.  As well, the Equal Employment Opportunity Commission ("EEOC") is also expected to finalize a rule that clarifies when a business should be classified as a joint employer under federal employment discrimination laws.


For additional information:  https://news.bloomberglaw.com/daily-labor-report/trump-cements-rule-to-limit-companies-joint-employer-liability

For a copy of the finalized rule:  https://aboutblaw.com/N6d

Comments

Post a Comment

Popular posts from this blog

NLRB: Discussion Among Employees About Tip Pooling is Protected Concerted Activity

  This Advice Memorandum from the National Labor Relations Board’s Associate General Counsel, Jayme Sophir, addressed whether employees which discussed and complained about tip pooling at work constituted protected concerted activity. In relevant part, an employer in New York operated a chain of steakhouses.  While tip pooling was in place at these steakhouses, some of the employees objected to it on the grounds that it was not transparent and improperly divided tips among the workers.  Employees were told not to complain or talk to each other about the tip pool and were told that doing so would endanger their jobs.  Despite the employer later attempting to provide some clarity as to how the tips were being divided, rancor still existed among some employees.  At one point, the employees were told by a general manager that some employees that had been talking about the tip pool were “cleared out” and the employer would continue to do so. In the Advice Memorandum, it was noted that emplo
Post a Comment
Read more

What I’ve Been Reading This Week

A few years ago, I remember when the “Fight for $15” movement was taking off around the country.  Lo and behold, it appears that a $15/hour minimum wage is not the stopping point, which should be no surprise.  As the below article notes, New York is aggressively moving to ramp up hourly wage rates even higher.  While all the  below articles are worth a read, I called particular attention to that one. As always, below are a couple article that caught my eye this week. Disney World Workers Reject Latest Contract Offer Late last week, it was announced that workers at Disney World had rejected the most recent contract offer from the company, calling on their employer to do better.  As Brooks Barnes at The New York Times writes, the unions that represent about 32,000 workers at Disney World reported their members resoundingly rejected the 5 year contract offer which would have seen workers receive a 10% raise and retroactive increased back pay.  While Disney’s offer would have increased pa
Post a Comment
Read more

Utah Non-Compete Bill Falters in House

Last month, a non-compete bill sponsored by Representative Brian Greene (Republican from Pleasant Grove) & up for vote in the Utah House failed to make it through the Legislature.  The bill sought to ban enforcement of non-competes if they came after a worker was already employed, given no compensation (such as a bonus or promotion) for signing the non-compete, and laid off within six months.  However, by a 22 - 49 vote, the bill was resoundingly defeated after some business groups lobbied to kill the non-compete bill.  One group in particular, The Free Enterprise Utah coalition, argued that the Utah State Legislature should hold off on any changes to non compete laws in the state until a survey about non competes was done among Utah businesses.  Representative Greene had countered this claim and argued that a survey was not needed to show that the current non compete laws in the states allowed many businesses, including some small high tech companies in the state, to per
Post a Comment
Read more