On January 12, 2020, the US Department of Labor issued a revision to the ruling on joint employer under the Fair Labor Standards Act. The ruling will go into effect on March 16, 2020.
From the DOL website, in the final rule, the Department:
- specifies that when an employee performs work for the employer that simultaneously benefits another person, that person will be considered a joint employer when that person is acting directly or indirectly in the interest of the employer in relation to the employee;
- provides a four-factor balancing test to determine when a person is acting directly or indirectly in the interest of an employer in relation to the employee;
- clarifies that an employee’s “economic dependence” on a potential joint employer does not determine whether it is a joint employer under the FLSA;
- specifies that an employer’s franchisor, brand and supply, or similar business model and certain contractual agreements or business practices do not make joint employer status under the FLSA more or less likely; and
- provides several examples applying the Department’s guidance for determining FLSA joint employer status in a variety of different factual situations.