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,...
Post a Comment
Read more

Breaking: Labor Secretary Rumored to Be Leaving Administration

A few hours ago, word leaked out that Labor Secretary Marty Walsh (“Walsh”) is in the midst of negotiations to head up the NHL Players Union and leave his position at the Labor Department. Walsh, who has served as the sole Labor Secretary under President Biden, has taken part in a labor renaissance of sorts as support for organized labor has increased during his term as Labor Secretary (although the number of workers that have joined a union over the past two years has not grown as mush as some expected.)  He has also overseen the ongoing negotiations with rail workers over a new contract, although that matter is still on shaky ground and playing out as we speak. As for who might step into the vacant Labor Secretary role, there are already rumblings that President Biden should nominate Deputy Labor Secretary Julie Su (a strong labor advocate) or even a progressive like Senator Bernie Sanders.  Until Walsh officially gives his notice, however, I would expect some/many potential...
Post a Comment
Read more

New Jersey Governor Chris Christie Vetoes Minimum Wage Hike

A few months ago, readers might remember that I pointed out that the New Jersey Legislature had voted to approve a minimum wage hike in the state .  Under the approved legislation, the minimum wage rate would rise to $10.10/hour in the next year and at least $15/hour over the next five.  (The current minimum wage rate in the state is $8.38/hour).  In that article, I had noted that the bill was then going to go before Governor Chris Christie for his approval or veto. As I had suggested previously, I thought that the Governor would likely veto the bill based upon his prior actions and comments on similar legislation.  Well, a few days ago, Governor Christie did just that and vetoed the bill on the grounds that it "would trigger an escalation of wages that will make doing business in New Jersey unfathomable."  Pointing to the increase in hourly minimum wage rates, the Governor referred to the bill as a "really radical increase."  (It is interesting to c...
Post a Comment
Read more