The last several federal administrations have gone back and forth regarding how to define a joint employer under federal law and specifically under the Fair Labor Standards Act (FLSA). For the uninitiated, a joint employer exists where two separately incorporated entities are treated as a single employer with respect to an employee or group of employees. Joint employers are jointly and severally liable for FLSA compliance, including any wages, damages and penalties owed to the employees. Importantly, this can be true even where the two entities are, by outward appearances, separate.
Last spring, the Department of Labor (DOL) announced that they were considering a notice of proposed rulemaking (NPRM) to adopt regulations regarding how the department would enforce joint employer liability going forward, which they hope will provide guidance and promote greater uniformity among courts nationwide. While the announcement stated that it would be a “major change,” there is no firm timetable for the adoption. Nonetheless, an opinion from the DOL from earlier this fall may give some indication of where the DOL is headed.
The opinion letter, FLSA 2025-05, responded to an individual employee’s request for an opinion concerning the application of the FLSA to the facts as alleged – facts which the DOL does not independently verify. The employee claimed she worked at both a restaurant and a members-only club, which operated on the first and second floors of an unnamed hotel. The...
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