• Jackson Shields Yeiser

DOL Rescinds Joint Employer Rule

By Paula Jackson

September 20, 2021

The Department of Labor (“DOL”) is rescinding the Rule referred to as the “Joint Employer Status under the Fair Labor Standards Act” (“FLSA”) effective October 5, 2021.[1] That rule went into effect in March of 2020 to help determine when businesses could be considered “joint employers” of certain workers and thus jointly liable for their FLSA minimum wage and overtime claims.

The DOL cited several reasons for rescinding the Rule. First, it inaccurately focused on control of the worker instead of considering the total circumstances, including the worker’s economic dependence on the business. Second, the DOL felt that the Rule might potentially categorize more businesses as non-employers instead of “joint employers,” thereby reducing the number of minimum wage and overtime claims that workers could bring.

Rescission of this Rule implies that the DOL’s definition of “joint employer” has widened and may now encompass more businesses. Therefore, please consult your employment law attorney for guidance on whether your business could soon be held liable for workers’ minimum wage and overtime claims as a “joint employer” due to the rescission of this Rule.

This article is for informational purposes only and is not intended to provide legal or tax advice. Receipt of or viewing information on this website does not create an attorney-client relationship. You may contact our firm to establish such a relationship, but in any event, please consult an attorney or tax professional of your choosing for advice on this or any other legal topic.

[1] “Rescission of Joint Employer Status Under the Fair Labor Standards Act,” Department of Labor, Wage & Hour Div., 29 C.F.R. Part 791, https://www.govinfo.gov/content/pkg/FR-2021-07-30/pdf/2021-15316.pdf (last checked Sept. 20, 2021); https://www.dol.gov/agencies/whd/flsa/2020-joint-employment (last checked Sept. 20, 2021).

39 views0 comments