Thanks to new guidance from the Department of Labor’s Wage and Hour Division, it may now be easier for workers in joint employer arrangements to pursue – and win –claims for unpaid wages and overtime.
The DOL says it frequently encounters joint employer situations – situations where an individual is employed by two or more employers – when companies share employees, use contractors, or make use of temporary staffing agencies. This is happening more often as companies explore non-traditional organization and staffing models.
The agency is finding these arrangements across industries, including construction, agricultural, janitorial, warehouse and logistics, staffing, and hospitality. With the rise of joint employment, the DOL has now acted to clarify employer responsibilities under the Fair Labor Standards Act (FLSA) and the Migrant and Seasonal Agricultural Worker Protection Act (MPSA).
Specifically, the new guidance lays out the obligations of joint employers with respect to FLSA and MPSA compliance – and the DOL’s authority in enforcing those laws. The guidance notes that:
When two or more employers jointly employ an employee, the employee’s hours worked for all of the joint employers during the workweek are aggregated and considered as one employment, including for the purposes of calculating whether overtime pay is due. Additionally, when joint employment exists, all of the joint employers are jointly and severally liable for compliance with the FLSA and MSPA
All employers in a joint relationship, then, are liable for any and all wage and hour obligations, particularly those addressed by FLSA and MSPA. The DOL is very clear on this point, stating it will “hold all responsible parties accountable for their legal obligations.”
The DOL is taking this issue very seriously, as evident in a blog post from the head of the Wage and Hour Division that went out after the new guidance was released. In it, Department Administrator Dr. David Well expressed concerns about what he calls the growth in “fissured employment,” and reiterated that the DOL is dedicated to “upholding a fair day’s pay for a fair day’s work.” His comment that the Labor Department “will continue to identify where joint employment applies and to hold all employers responsible” leaves very little doubt that this is an enforcement priority for the agency.
With such specific new guidelines from the DOL, and a growing concern at the agency about the impact of joint employment on workers, it is clear employers must meet their wage and hour obligations in every situation. The DOL has provided clear guidance on this issue – and a roadmap for recovery for employees not treated fairly by joint employers.
If you suspect that you’ve been a victim or wage theft or wage abuse, please contact the Employment Litigation attorneys at Sommers Schwartz today – we’re here to help.