Published Date: 08/04/2014
By Pat Rountree
The joint employer relationship exists where two (or more) employers exert some control over the same employee in a particular job. For employers who employ temporary agency employees, the joint employment relationship exists. Each employer has responsibilities under this joint employment arrangement and the individual employment laws address the responsibilities of each.
While the laws generally address looking at the totality of the employment situation, they also address specifics of what determines who the primary employer is and who is secondary, and their respective responsibilities.
This is an in-depth subject, but following is an overview of some of the key responsibilities under major employment laws.
Joint employment as defined by the Fair Labor Standards Act (FLSA) exists:
1) Where there is an arrangement between employers to share an employee’s services or to interchange employees;
2) Where one employer acts directly or indirectly in the interest of the other employer in relation to the employee; or
3) Where the employers are not completely disassociated with respect to the employee’s employment and may be deemed to share control of the employee, directly or indirectly, because one employer controls, is controlled by, or is under common control with the other employer.
Factors considered in determining which employer is the primary employer in a joint employment relationship include the authority or responsibility to:
- Hire and fire;
- Make payroll; and
- Provide employment benefits.
Both covered employers in a joint employer situation are responsible individually and jointly for complying with the FLSA (minimum wage, overtime, timekeeping, etc.). The primary employer (the one who directly pays the employee) is responsible for the recordkeeping requirements under the FLSA. (Source: Wage and Hour Field Operations Handbook).
Only the primary employer is responsible for giving required notices to its employees, providing FMLA leave and maintaining health benefits. Factors considered in determining who the primary employer is include authority and responsibility to hire and fire, assign or place the employee, make payroll, and provide employment benefits.
The secondary employer is responsible for restoring the staffing agency employee to the position they held prior to going on FMLA if they are still using that staffing agency to fill the position.
If not, the primary employer (agency) has the responsibility to place the employee in an equivalent position.
(29 CFR 825.106 and WHD Opinion Letter FMLA 2004-1-A)
Laws Enforced by EEOC
(Non-discrimination laws. See CAI's The specified item was not found., Chapter 12 for more information)
Under the laws enforced by the EEOC, both the staffing firm and the client employer have responsibility if they meet the coverage threshold for the number of employees (Title VII – 15 employees and ADEA – 20 employees). Temporary agency employees working at a client site must be counted by both employers in determining their individual coverage.
Both the staffing agency and the client employer may have liability based on discriminatory hiring, assignment, or wage practices, or for discrimination or harassment at the work site. If a charge is filed and violations are confirmed, the EEOC will determine and allocate liability based on employer responsibility for the violation.
The staffing agency generally has responsibility for accommodation in the application process since they are interviewing and procuring placement. If the client sends an applicant through the agency, the client and staffing agency are responsible.
Both employers must follow the ADA guidance on medical inquiries pre-employment, post-offer and during employment. For a staffing agency employee, an offer of employment occurs at the time the employee is assigned to a client site.
On the job, both employers may have responsibility for reasonable accommodation absent undue hardship. The EEOC suggests that employers may want to cover in their contracts how reasonable accommodation and costs will be handled. For more, see http://j.mp/EE-CW.
OSHA/NC Workers’ Compensation
Where a staffing agency is the primary employer, they will be responsible for filing with workers’ compensation and covering costs. The secondary employer/client will record the injury on their OSHA 300 log. Both employers have responsibility for ensuring that the temporary employee has the same safety training as required for the client’s regular employees. Both employers have the responsibility to notify the other employer of an on-the-job injury or exposure/illness. For more on OSHA’s role, see http://j.mp/OS-TW.
For more information, attend the Advice and Resolution Corner Plus members-only webcast scheduled for this Wednesday, August 6, 2014 from 9:00 am until 9:30 am. You can self-register for this webinar at https://www4.gotomeeting.com/register/966284103.
Feel free to share this link with anyone from your organization who would benefit from attending.