The Trump administration finalized regulations that redefine the way certain agencies determine whether an individual has more than one employer, making it harder for workers—particularly those employed by contractors or staffing agencies—to hold companies accountable for workplace abuses. NWLC opposed these regulations.
A joint employment relationship is one in which a person is “jointly” employed by two or more companies. Various government agencies maintain their own tests and standards for determining whether corporations are joint employers, and courts have outlined differing tests to assess joint employment across labor and employment laws.
Questions about whether two or more employers are joint employers often arise when companies contract or subcontract with temp agencies or other companies—arrangements that are increasingly common and can undermine job quality and access to workplace protections. Workers employed through intermediaries like temporary and staffing agencies earn less money and endure worse working conditions than permanent, direct-hires. Women workers provided by contract firms in full-time jobs, for example, typically earn 17 percent less than women in traditional employment arrangements and 42 percent less than full-time male workers provided by contract firms.
The Trump administration has issued regulations that change the way the National Labor Relations Board (NLRB) and the Department of Labor (DOL) decides who is a joint employer under two key workplace protection laws:
- The NLRB rule changes the way the agency decides who is a joint employer under the National Labor Relations Act (NLRA), a law that protects the ability of employees to organize collectively to change conditions at their workplace, including through organizing a union. By making it harder to identify more than one employer as a joint employer under the NLRA, the rule will leave more workers unable to hold the companies that play a role in determining the terms and conditions of their employment accountable for violations of labor law.
Imagine, for example, that an individual is employed through a temp agency to work 40 hours a week in a factory. After working as a temp for a while, the workers in the factory (including the temp worker) decide to organize a union. The temp worker gets fired by the factory as retaliation for organizing a union. Under the NLRB rule, it will be more difficult for the temp worker to hold the factory accountable for the retaliation, because the temp worker will be unable to prove that they were jointly employed by the temp agency and the factory. The joint employer standard under the rule is also so narrow that many workers will find it nearly impossible to bring all companies with the power to influence their wages and working conditions to the bargaining table—frustrating workers’ fundamental right under the NLRA to engage in collective bargaining. Download NWLC’s comments on the NLRB joint employer rule.
- The DOL rule changes the way the agency decides who is a joint employer under the Fair Labor Standards Act (FLSA), which not only sets federal minimum wage and overtime standards but also contains provisions to ensure that women are treated equally at work, including employer obligations to accommodate breastfeeding workers and protections against pay discrimination. The DOL’s new joint employer standard is contrary to the 80 year old expansive definition of who is an employee and who is an employer under the FLSA, making it much more difficult to enforce the provisions of the FLSA against all employers responsible for illegal abuses. The NPRM would make it more difficult for subcontracted workers or workers contracted through a temp or staffing agency to hold all of their employers responsible for pay discrimination by raising the bar to prove joint employer status, thus giving management-side lawyers added ammunition in their attempts to help their clients escape liability for discrimination.
In September 2020, a federal district court held in State of New York v. Scalia that DOL impermissibly narrowed the joint employer standard under the FLSA; unless and until the decision is reversed on appeal or DOL adopts a new rule, courts should apply their pre-existing joint employer tests.