Employers increasingly rely on independent contractors, “temps” and other nontraditional workers to solve their business needs. These nontraditional work arrangements can raise a variety of complex legal issues related to joint employment liability, including but not limited to potential employment and labor law claims against the entity utilizing the nontraditional workers. Liability as a joint employer is governed by an increasingly disparate number of factors for determining “employee status” under various federal and state statutes, and regulatory schemes. Employers are left struggling to navigate the expansive and shifting regulatory, judicial and legislative definitions that determine joint employment liability. This article endeavors to help employers and employment law practitioners understand joint employment liability through a discussion of these new and developing legal standards.
The federal government continues its quest to narrow the parameters for joint employment liability. The U.S. Department of Labor (DOL) recently rescinded Obama-era guidance that greatly expanded the scope of joint employment. See https://www.dol.gov/newsroom/releases/opa/opa20170607. The first administrative interpretation (AI) that was rescinded addressed the classification of independent contractors as employees under the FLSA. The DOL essentially created a presumption of employment for all workers under the FLSA, stating “most workers are employees under the FLSA’s broad definitions.” see administrator’s interpretation No. 2015-1 (July 2015). The second AI that was rescinded established new standards for determining joint employment under the Fair Labor Standards Act (FLSA) and the Migrant and Seasonal Agricultural Worker Protection Act (MSPA). The DOL took the position that “the concept of joint employment, like employment generally, should be defined expansively under the FLSA and MSPA.”
