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House Introduces Bipartisan Bill Designed to Ease Joint Employer Uncertainty

On July 27, 2017, House Republicans unveiled a bill, entitled the Save Local Business Act, that would amend two labor and employment statutes to clarify when an entity can be deemed a “joint employer.” At a press conference debuting the legislation, several of its sponsors, along with supporters from the business community, spoke about the need for the legislation.

The Fourth Circuit’s New Test for Joint Employment Under the FLSA and Why You Should Care

The Fourth Circuit Court of Appeals’ recent articulation of a new test for joint employment under the Fair Labor Standards Act (FLSA) sets a challenging standard for general contractors and others that seek to minimize labor costs by subcontracting out work, and highlights the importance of carefully choosing business partners and subcontractors in order to avoid wandering into wage and hour violations. In formulating the test, the court relied upon Congressional intent to define “employer” expansively under the FLSA and set aside decades of precedent from sister circuits and their progeny. Salinas v. Commercial Interiors, Inc., No. 15-1915 (January 25, 2017).

Fourth Circuit Panel Establishes Joint Employer Test

In a decision published January 25, 2017, a Fourth Circuit Court of Appeals panel revived a collective action in which a group of drywall installers sought overtime wages from the contractor who hired their employer – the subcontractor. The outcome is a new circuit wide test for determining whether a joint employer relationship exists.

Fourth Circuit Creates New Joint Employment Test under the Fair Labor Standards Act

Executive Summary: The United States Court of Appeals for the Fourth Circuit recently issued a decision which clarifies and expands the circumstances under which entities may be held liable as joint employers under the Fair Labor Standards Act (FLSA). The Court emphasized that the proper focus should be on the relationship between the alleged joint employers and not on an analysis of the economic dependency between the worker and the entities. The Court concluded that “joint employment exists when the facts establish that employment by one employer is not completely disassociated from employment by the other employer.” See Salinas v. J.I. General Contractors (4th Cir. January 25, 2017).

Fourth Circuit Decision Establishes New Six-Factor Test for Determining Joint Employment under the FLSA

On January 25, 2017, the U.S. Court of Appeals for the Fourth Circuit established a new six-factor test to determine whether two or more entities are joint employers for purposes of the Fair Labor Standards Act (“FLSA”). Salinas v. Commercial Interiors Inc., No. 15-1915, ___ F.3d ___, 2017 WL 360542 (4th Cir. Jan. 25. 2017). The resulting standard is unique from other circuits and appears to expand joint employer liability under the FLSA.

Fourth Circuit Pronounces Joint Employer Test Under FLSA

On Jan. 25, 2017, the Fourth Circuit Court of Appeals, which has jurisdiction over North and South Carolina, issued an opinion in a collective action wage and hour case setting forth a six-factor test for determining whether two persons or entities constitute joint employers under the Fair Labor Standards Act (FLSA). Salinas v. Commercial Interiors Inc., Opinion No. 15-1915. On the same day, the court also issued another opinion in two consolidated wage and hour cases under the FLSA, applying the six-factor test and reversing the district court’s dismissal of the cases. Hall v. DirectTV, LLC, Opinion Nos. 15-1857 and 15-1858. These opinions resolve some uncertainty regarding joint employment determinations under the FLSA that had been created by the varying tests used by district courts within the Fourth Circuit and set forth a broader, more expansive approach to joint employment determinations under the FLSA than under Title VII. A discussion of the Fourth Circuit’s joint employment test under Title VII can be found here.

Legal Alert: Eleventh Circuit Finds DHL Express Not a Joint Employer under FLSA

Executive Summary: On July 9, 2012, a federal appeals court in Georgia affirmed the dismissal of DHL Express, Inc., from a lawsuit brought by a class of current and former delivery drivers alleging overtime violations under the Fair Labor Standards Act ("FLSA"). According to the court, an assessment of the economic realities of the case did not reveal an employment relationship between DHL and the drivers.
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