Tag Archives: FLSA

03.01.18
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Despite New DOL, Independent Contractor Misclassification and Joint Employment Remain Risky

What effect of withdrawal of DOL memos

In June 2017, the DOL withdrew its Obama-era 2015 and 2016 informal guidance on joint employment and independent contractors. The memos covered federal wage and hour law (FLSA). Eight months later, what effect has that decision made?

Essentially none.

Remember, the 2015 and 2016 memos did not change the law on independent contractor misclassification or joint employment. Rather, the memos were an attempt by the Wage & Hour Administrator, David Weil, to summarize existing law – but with a pro-employee leaning. The memos selectively interpreted court decisions that supported Weil’s view of the world, i.e., that most workers are employees. When Weil left, the DOL said goodbye to his interpretations as well.

But … Continue reading →

02.08.18
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After the NLRB Ruling, Is Joint Employment Still a Concern?

What is joint employment - imageLast month in the Hy-Brand decision, the NLRB raised the bar for determining whether a business is a joint employer. So now what? Is joint employment still a concern for businesses?

To paraphrase Tina Fey paraphrasing Sarah Palin paraphrasing Margie in Fargo, Ya! You betcha!

While the recent NLRB decision dropped the alert to Def-Con 4 in labor relations, the joint employment landscape under wage and hour laws is getting worse for employers, not better, thanks to the Fourth Circuit Court of Appeals. Businesses should Continue reading →

01.29.18
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Joint Employment Tests Will Remain a Mess, Thanks to an Indecisive Supreme Court

Joint employment tests are messy FLSA

Is your business a joint employer?

This sounds like a straightforward question. Unfortunately, it’s not. The test for whether a business is a joint employer varies depending on which law is being considered and where the business is located.

Let’s focus on that last part, because it is pretty ridiculous. The federal law covering overtime and minimum wage requirements is the Fair Labor Standards Act (FLSA).  The FLSA is a federal law, so it should mean the same thing all around the country, right? Right. It should. But it doesn’t.

As we saw in this map, the test for joint employment under the FLSA varies depending on what state your business is located in.

Continue reading →

01.08.18
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Free Bird! Dep’t of Labor Rewrites Test for Unpaid Internships

chicks-2965846_1920Lots of things are free in the world of music. There’s Free Bird (Lynyrd Skynyrd), Free Money (Patti Smith), and according to Dire Straits, you can get your money for nothin’ and your chicks for free.

For the most part, though, you’ve got to pay for your interns. Or do you?

On Friday, the DOL announced it was reversing its 2010 guidance on Internship Programs under the Fair Labor Standards Act. Since 2010, the DOL had been taking the position that unpaid interns are employees and must be paid unless each of six factors were present. Here’s the old DOL fact sheet and six-factor test.

The DOL has now changed course, after four U.S. Court of Appeals decisions rejected the DOL’s test as too strict. The DOL now opted for a balancing test. The balancing test asks whether the intern or the business is the “primary beneficiary” of the internship.

The DOL’s new guidance adopts the same balancing test recently favored by the courts.

Continue reading →

11.02.17
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Time to Dance? Momentum Builds for Proposed New Joint Employment Law

Screen Shot 2017-10-28 at 11.47.09 AM

Leadership Lessons from Dancing Guy is a low-quality youtube video that has somehow amassed more than a million hits. In the video, a lone (possibly intoxicated) festival goer starts dancing in a field. After a minute or so, momentum builds and others join him, showing off their terrible dance moves in a video you’ll wish you hadn’t wasted three minutes watching. (Just speaking from experience here.)

Several weeks ago, the House began considering a bill that would rewrite the definition of “joint employment” under federal wage and hour law (Fair Labor Standards Act) and federal labor law (National Labor Relations Act). The Save Local Business Act would require “direct” and “significant” control over “essential terms” of employment before a business could be considered a joint employer of a worker employed by another business (such as a staffing agency or a subcontractor). Read more here and here.

Originally sponsored by Rep. Bradley Byrne of Alabama (you might think of Rep. Byrne as the original dancer in the Leadership video, but dressed as a conservative Southern gentleman), the bill now has 112 co-sponsors, including a few Democrats. Dance party!

Continue reading →

10.30.17
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Court Rules That Shadowing Dad at Work Might Require Payment

Shadow - Trainee or Employee death-2577486_1280In the 1930s, the popular radio program The Shadow featured an invisible avenger who possessed “the mysterious power to cloud men’s minds, so they could not see him.” (He supposedly picked up this power in East Asia, which must have seemed mysterious in an era before Kung Pao Chicken was widely available.)

Eighty years later, “shadowing” has a different meaning. An unpaid trainee follows around a more experienced employee as a way to learn the business. Few trainees have mastered the power of invisibility [Note: only the best ones have, and they’re hard to find … ba-dum-bum], and often the nature of being a trainee involves getting in the way of the real work.

Scott Axel was a trainee who shadowed his father at an automobile wholesaler in Florida. He had no expectation of pay, and the business said it would not hire him. As a favor to his dad, the business let him learn the business by shadowing his dad.

Continue reading →

10.26.17
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Would You Like Some Pepperoni with Your (Oops) Joint Employment?

Joint employment pizza 31E83EC5-E554-428A-A5D6-37F13905C3B9According to pizza.com, “There are approximately 61,269 pizzerias in the United States.” That number seems pretty precise to me, not an approximation, but who am I to question something I read on the internet?

Approximately 4 of the 61,269 pizzerias are owned by a New Yorker named Paola P., who runs each of the 4 under a different LLC. Paola’s employees can be assigned to any of the 4 pizzerias on their workdays. Seems boring so far, but stay with me. Now say this three times fast:

Paola’s practice prompted problems since Paola P’s pizzerias were impermissibly positioning personnel to prevent paying overtime. 

Pity.

Continue reading →

09.05.17
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When to Embrace Joint Employment, and When to Run Like Hell (Pink Floyd, 1979)

Joint employment risks dangers choices joint employer IMG_1101Life is full of serious questions. For example, Should I stay or should I go? (The Clash, 1982). Or, Will you love me forever? (practically every song ever, but for now, we’ll go with Meatloaf in Paradise by the Dashboard Lights, 1977).

When engaging non-employee workers, businesses must also confront a serious question: Embrace joint employment, or try to avoid it? (Frank Zappa confronted a different kind of serious question in Why Does It Hurt When I Pee?, 1979, but that’s beyond the scope of this blog.)

Many of my posts have been geared toward strategies for trying to avoid joint employment. There is another way, though. Sometimes, it may be better to embrace joint employment. But know the pros and cons.

Here are some things to consider: Continue reading →

08.03.17
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Joint Employment Legislation Needs to Be Expansive — If It’s to Be Effective

IMG_1093On Monday, we wrote about the Save Local Business Act — proposed legislation that, if passed, would create a new definition for joint employment under the NLRA and FLSA. But would that law go far enough?

No. Not at all.

On the bright side for businesses, the law would provide some predictability in that staffing agency workers would most likely be excluded from bargaining units. It would also remedy the current unfairness that results when a staffing agency makes payroll and overtime miscalculations but the company using the workers is held responsible as a joint employer.

But much more needs to be done to provide real clarity and predictability for business owners.

First, the law fails to address who is a joint employer under other federal employment Continue reading →

07.31.17
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Congress May Rewrite “Joint Employment” Definition

IMG_1092Congress may finally provide some clarity in determining who is a joint employer. In legislation introduced last week, the House proposed a bill that would rewrite the definition of “joint employer” under federal labor law (National Labor Relations Act) and federal wage and hour law (Fair Labor Standards Act).

The Save Local Business Act — despite lacking a fun-to-say acronym — would create a new standard for determining who is a joint employer under these two laws. The proposed new standard would allow a finding of joint employment “only if such person [business] directly, actually, and immediately, and not in a routine and limited manner, exercises significant control over the essential terms and conditions of employment….”

The definition provides examples of what are “essential terms and conditions,” including: Continue reading →