Joint Employment

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Co-authored by Alex Passantino and Kevin Young

Seyfarth Synopsis: On April 1, 2019, the U.S. DOL announced a proposed rule to clarify joint employment under the FLSA. The rule would establish a four-factor balancing test for joint employer status. It also rejects various factors that have fueled recent litigation, e.g., a worker’s economic dependence on a potential joint employer, the potential employer’s business model, and its unexercised power over the worker.

This is the third proposed rule that the DOL has issued in a month’s time. Like the other proposals (concerning overtime exemptions and the regular rate of pay), this rule—if adopted—should provide welcome clarity for many businesses. This is particularly true for those most targeted by joint employment litigation, such as franchisors, staffing agencies, and businesses with subsidiaries or affiliates.

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By:  Alexander Passantino

On February 28, the Wage & Hour Division sent to the White House Office of Information and Regulatory Affairs its long-awaited regulatory proposal on joint employment.  Not much is known about the proposal, which was described in the Regulatory Agenda as addressing the changes in the workplace in the 60 years since…

Co-authored by: Steve Shardonofsky and John P. Phillips

Seyfarth Synopsis: On November 7, 2017, the U.S. House of Representatives passed the Save Local Businesses Act. If passed by the Senate, the bill would overturn Obama-era decisions and agency guidance broadly defining and holding separate, unrelated companies liable as “joint employers” under federal wage & hour …

Authored by Alex Passantino

On June 7, Department of Labor Secretary Alexander Acosta announced the withdrawal of the DOL’s 2015 and 2016 Administrator Interpretations (“AIs”) on joint employment and independent contractors. These documents were statements of the Wage & Hour Division’s interpretations of the FLSA’s (and Migrant …

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Co-authored by Gerald L. Maatman, Jr., Gina Merrill, Brendan Sweeney, and Mark W. Wallin

Seyfarth Synopsis: A New York federal court in Durling, et al. v. Papa John’s International, Inc., Case No. 7:16-CV-03592 (CS) (JCM) (S.D.N.Y. Mar. 29, 2017), recently denied Plaintiffs’ motion for conditional certification of a nationwide collective action in …

Co-authored by Julie Yap and Billie Pierce

Seyfarth Synopsis: A federal court in California recently held that a franchisor cannot be held liable for labor code claims where it did not exercise control directly, or through an actual agency relationship with the employer, over the terms and conditions of the workers’ employment. The decision limits …

Authored by Brett Bartlett

Seyfarth Synopsis: The Fourth Circuit Court of Appeals recently set forth a new standard for determining whether two or more businesses may be held responsible as joint employers for overtime pay due to a single worker because they are joint employers. Although more expansive than other courts’ standards — and even …

Authored by Gerald Maatman, Jr. 

Seyfarth Synopsis: Workplace class action filings were flat overall and even decreased as compared to levels in 2015. However, that is apt to change in 2017. In the 4th in a series of blog postings on workplace class action trends, we examine what employers are likely to see in 2017.…

SDFLAuthored by Christopher Kelleher and Noah Finkel

Seyfarth Synopsis: Federal court denies motion for conditional certification for a proposed class of employees working at separate Subway franchises.

Earlier this year, the DOL’s Wage-Hour Division issued a much-publicized Administrator Interpretation on what employers constitute joint employers, including an explanation of how two or more employers…

Authored by Alex Passantino

The President’s FY2017 budget request seeks a nearly $50 million increase in the Wage & Hour Division’s budget.  This more than 20% increase would fund, among other things, 300 additional investigative staff — putting the number of WHD employees over 2,000 for the first time in recent memory.  WHD also…