Rising Amount of Temporary Labor Renews Concerns Over Joint Employment


According to the latest jobs report from the Department of Labor issued in January, the US had added 292,000 jobs in December. The report notes that temp help employment rose by 34,400, or 1.18%. Revisions increased overall job gains in October and November by 50,000, and increased temp gains by 6,800.  Staffing Industry Analysts say that temp labor continues to surge as a portion of the overall workforce composition in the US. With that increase in usage will certainly come a correlated increase in the number of joint employment infractions, something we’ve discussed at this blog before.

Anticipating the impact of growing ranks of staffing-supplier provided temporary labor, the Department of Labor’s Wage and Hour Division has issued new guidance on joint employment to help organizations avoid liabilities and penalties as they’re clearly utilizing increased volumes of temp labor which is clearly on the rise. In a post at the Dept of Labor’s Blog, wage and hour administrator, David Weil wrote, “Last summer, for example, a federal court in Seattle sided with the department in ruling that DirecTV was a joint employer of the installers hired by its contractor, resulting in DirecTV paying $395,000 in back wages and damages for minimum wage and overtime violations. And in October, we announced that J&J Snack Foods Corp. would pay $2.1 million in back wages and damages to temporary production line workers hired by two staffing firms that J&J contracted with to provide labor.”

So the Wage and Hour Division issued some guidance and clarification to ensure clarity around the rules as they currently stand. From the WHD portion of the DOL website, here are some Q&A facts to consider.

Q: What is joint employment?

A: Joint employment exists when an employee is employed by two (or more) employers such that the employers are responsible, both individually and jointly, for compliance with a statute. Both the Fair Labor Standards Act (FLSA) and the Migrant and Seasonal Agricultural Worker Protection Act (MSPA) provide for joint employment.

Q: What are some industries where there might be joint employment?

A: WHD investigators come across employment scenarios where there might be joint employment in all industries, including, for example:

  • Home health care agencies that share staff and common management;
  • Construction (workers who work for a sub-contractor and possibly a general contractor);
  • Agriculture (farmworkers who work for a farm labor contractor and possibly a grower);
  • Warehousing and logistics;
  • Staffing (providing labor to multiple industries); and
  • Hospitality

As our earlier post on this issue notes, it is dangerous to assume simply because you didn’t source and onboard a contractor, or because a contractor’s paycheck comes from a staffing supplier that hired him/her, that you hold no liability. Clearly, staffing providers are on the WHD radar and are being scrutinized for issues of joint employment right alongside the customers who engage these suppliers. Make sure your workforce management program has strong processes and policies in place to ensure proper application and compliance with all applicable regulations. Speak to nextSource experts for guidance on how to protect your program today.

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