DOL Issues Joint Employer Rule, But There’s a Big Caveat

On April 1, the Department of Labor’s (DOL) Wage and Hour Division issued a notice of proposed rule-making (NPRM) for the joint employer rule, receiving praise from Republican members of the House Education and Labor Committee. MKAI HR Alert has noted the significance of this issue for certain kinds of supports for people with intellectual / developmental disabilities (I/DD): “It is also a major issue with the employers and programs serving persons with disabilities with supported employment, job development, case management, respite care, residential care, supervised independent living, consumers in community-based transition employment, and similar support occupations.” Given this relevance to our members’ supports and services, ANCOR will be planning to submit comments to the proposed rule – make sure you are a member of our Government Relations Committee to be part of a work group (contact [email protected] for more information).

As written in the NPRM, the rule seeks to “revise and clarify the responsibilities of employers and joint employers to employees in joint employer arrangements.” To do so, the “Department proposes a clear, four-factor test—based on well-established precedent—that would consider whether the potential joint employer actually exercises the power to:

• hire or fire the employee;
• supervise and control the employee’s work schedules or conditions of employment;
• determine the employee’s rate and method of payment; and
• maintain the employee’s employment records.”

The NPRM includes examples of different joint employer scenarios, starting on page 56.

Politico Pro has highlighted one important caveat to this rule: it is interpretative (guiding) rather than carrying the force of law: “POLITICO last year received an interim document on the rule as DOL was drafting it that indicated DOL and the White House concluded the rule would have to be interpretive because the FLSA doesn’t ‘expressly grant’ DOL authority to write a joint employer rule that’s legally binding. Patricia Smith, former solicitor of labor during the Obama administration, explained to POLITICO at the time that it wouldn’t likely ‘be given any more deference than an administrator’s interpretation.’” Access the document.