The JoinT employer rule: A push for ConsisTenCy
Labor & Employment Law Section
Chairs: Amanda Biondolino - Sass Law Firm and Jason Pill - Phelps Dunbar, LLC
I
n recent years, there has
been an increased focus on
the standards applied by
regulators when determining
whether distinct business entities
share sufficient control over a
group of employees, such that
they may be considered “joint
employers.” Confusion stemming
from divergent joint employer
standards has prompted
administrative agencies to provide
clarification. In November 2019,
the federal government released
its Fall 2019 Unified Agenda
of Federal Regulatory and
Deregulatory Actions (the Agenda),
with the goal of more effective
and less burdensome regulation.
Per the Agenda, three agencies —
the Equal Employment
Opportunity Commission (EEOC),
the National Labor Relations
Board (NLRD), and the
Department of Labor (DOL) —
each plan to issue regulations
governing joint employment by
the end 2020, if not sooner.
The NLRB has proposed to
update its joint employer test under
the National Labor Relations Act
by eliminating a controversial
2015 standard set in the NLRB’s
Browning-Ferris decision, 1 which
balancing test
permitted a
assesses whether
joint employer
the potential
finding even
joint employer:
where a
(1) hires or fires
company has
the employee;
only “indirect”
(2) supervises
control over
and controls the
another
employee’s work
company’s
schedules or
workers. In
conditions of
2018, the
employment to
NLRB
a substantial
proposed a
degree; (3)
rule that would
determines the
effectively
employee’s rate
reinstitute a
and method of
pre-Browning-
payment; and
Ferris standard
(4) maintains
that designates
Three federal agencies
the employee’s
a business as a
employment
joint employer
take action to provide
records. The
only if it
clarification
on
joint
intent behind
“possess[es]
the DOL’s
and actually
employer standards.
proposed
exercise[s]
rule was to
substantial
specifically focus
direct and
on whether an
immediate
employer exercises sufficient control
control” over the employees’
over an employee’s terms and
essential terms and conditions of
conditions of employment to
employment, such as hiring, firing,
qualify as a joint employer.
discipline, supervision, and
Following in the footsteps of
direction, in a manner that is not
the NLRB and DOL, the EEOC
limited and routine. 2 The NLRB is
included a notice in the Agenda
expected to finalize the rule in the
that it plans to release a notice of
near future.
proposed rulemaking outlining the
Soon after the comment period
agency’s standard for evaluating
on the NLRB’s regulation closed,
whether affiliated businesses qualify
the DOL published its notice of
as joint employers. The EEOC
proposed rulemaking, proposing to
categorized its proposal as
update its 60-year-old framework
“amendments” to various laws the
for analyzing joint employment
agency enforces, including Title VII
under the Fair Labor Standards
Act. 3 Taking effect on March 16,
2020, the DOL’s new four-part
Continued on page 37
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36
MAR - APR 2020
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HCBA LAWYER