Skip to main content
Home

Main navigation

News & Analysis Policies & Forms Your Library Attorney Network
News & Analysis Policies & Forms Your Library Attorney Network

User account menu

Sign in Get Started
x

You're signed out

Sign in to access subscriber actions.

DOL issues joint-employer rule: Employer liability narrowed

January 2020 employment law letter
Authors: 
Burton J. Fishman, Fortney & Scott, LLC

The U.S. Department of Labor (DOL) has issued its long-awaited rule on joint employment. The bottom line is that the agency has opted to reestablish the understanding that had been in place for decades—i.e., routine, direct control of the terms and conditions of employment will be the measure of joint employment. The new rule will become effective March 16. A result of the new rule is that liability for many workplace laws is more constricted than that proposed by the Obama administration.

New joint-employer rule

At the core of the DOL's regulation are four criteria. Does the alleged joint employer:

  1. Hire or fire the employee;
  2. Supervise and control the employee's work schedule or conditions of employment to a substantial degree;
  3. Determine the employee's rate and method of payment; and
  4. Maintain the employees employment records?

No single criterion will be determinative, and assessment of all the criteria will be part of the analysis.

In addition, the rule makes clear that actions—not words—will be assessed. To that end, the rule makes clear that the mere reservation of rights in, for example, a franchise agreement will not be considered unless there is "some actual exercise of control."

Greater clarity

A significant aspect of the new rule is that it provides greater clarity to employers than the more amorphous standard that had been proposed by the Obama administration, which included vague elements of "indirect control."

Continue reading your article with a HRLaws membership
  • Sign in
  • Sign up
Upgrade to a subscription now
to get unlimited access to everything on HR Laws.
Start subscription
Any time

Publications

  • Employment Law Letter
  • Employers State Law Alert
  • Federal Employment Law Insider

Your Library Reading List

Reading list 6
Creating List 7
Testing

Let's manage your states

We'll keep you updated on state changes

Manage States
© 2025
BLR®, A DIVISION OF SIMPLIFY COMPLIANCE LLC | ALL RIGHTS RESERVED

Footer - Copyright

  • terms
  • legal
  • privacy