By Quarles & Brady LLP
April 9, 2019
On April 1, 2019, the Department of Labor (“DOL”) issued a notice of proposed rulemaking setting forth its interpretation of joint employment under the Fair Labor Standards Act (“FLSA”). This proposed rule is particularly important for franchisors, staffing agencies, third-party management companies and labor providers, whose business models call for multiple entities having some amount of interaction or influence over a group of workers.
Key determining factors in joint employment
The DOL’s proposed rule laid out four key factors that it will analyze for whether a business qualifies as a joint employer of a group of workers. The proposed test looks at whether the potential joint employer:
- hires or fires the employee;
- supervises and controls the employee’s work schedule or conditions of employment;
- determines the employee’s rate and method of payment; and
- maintains the employee’s employment records.