DOL Issues Final Joint-Employer Rule

On Jan. 13, the Department of Labor’s (DOL) Wage and Hour Division announced a final rule to update the regulations interpreting joint-employer status under the Fair Labor Standards Act (FLSA). In the final rule, the DOL establishes a four-factor test for determining FLSA joint-employer status in situations where an employee performs work for one employer that simultaneously benefits another entity or individual.

The four factors include hiring or firing of the employee, supervision and control of the employee’s work schedule or conditions of employment to a substantial degree, determination of the employee’s rate and method of payment, and maintenance of the employee’s employment records. The rule also provided several employment scenario examples that may or may not trigger a joint employer status.

IWLA submitted comments in support of the previously proposed rule, as well as some recommendations to the DOL for ways the rule could be revised to provide additional clarity regarding what business practices may result in joint-employer status. IWLA is pleased to see that the DOL included further clarification examples in response to IWLA and other organization’s comments.

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