Are you a Joint Employer?
In early 2016, the wage and hour division of the Department of Labor (DOL) released guidance regarding joint employment under the Fair Labor Standards Act (FLSA). The new guidance from the DOL identifies common scenarios in which two or more employers jointly employ an employee and are, as a result, jointly liable for compliance.
What is the definition of the joint employer? Joint employment exists where two or more employers benefit from the employee’s work and are sufficiently related to or associated with each other.
Examples of Joint Employment are as follows:
- The employers have an arrangement to share the employee’s services;
- One employer acts in the interest of the other in relations to the employee, or
- The employers share control of the employee, directly or indirectly, because one employer controls, is controlled by, or is under common control with the other employer.
Below are facts to consider when determining joint employment:
- Who owns or operates the possible joint employers?
- Do the employers have any overlapping officers, directors, executives or managers?
- Do the employers share control over operations?
- Are the operations of the employers intermingled?
- Does one employer supervise the work of the other?
- Do the employers treat the employees as a pool of workers available to both of them?
- Do the employers share clients or customers?
- Are there any agreements between customers?
What do joint employers need to do?
Joint employers have responsibilities under various laws but particularly FMLA. According to the DOL’s recent regulations, employees who are jointly employed by two employers must be counted by both employers in determining employer coverage and employee eligibility under FMLA, regardless of whether the employee is maintained on one or both of the employer’s payrolls.
Under FMLA, the primary employer is responsible for:
- Giving required notices to its employees
- Provide FMLA
- Maintain health insurance benefits during the leave
- Restore the employee to the same job or an equivalence job upon return from leave
- No interference by joint employers regarding employee’s right to exercise his or her FMLA rights
- Refraining from firing or discriminating against employee for opposing a practice that is unlawful
- Keep records required by the FMLA
- Must meet all the obligations of FMLA even when the secondary employer is not in compliance with the law.
