NMHC and NAA commented favorably on a proposed Department of Labor (DOL) rule governing when two entities are considered joint employers and liable for an employee’s wages under the Fair Labor Standards Act (FLSA) on April 29. The FLSA requires employers to pay at least the minimum wage and overtime to non-exempt employees who work in excess of 40 hours in a week.
As previously reported, the DOL issued a proposed rule on this matter in early April. As outlined in that rule, DOL is proposing a four-factor test that would determine whether employers are joint employers. This proposal is the first significant update to the joint employer regulations since 1958.
DOL also noted that additional factors may be used to determine joint employer status. However, these factors would only apply if the potential joint employer demonstrates significant control over the terms and conditions of the employee’s work or is otherwise acting directly or indirectly in the interest of the employer in relation to the employee.
For more specifics regarding how the proposed joint employment rule would apply, please review the DOL’s list of FAQs and examples: https://www.dol.gov/whd/flsa/jointemployment2019/joint-employment_faq.htm
NMHC and NAA believe this proposed test would provide clear rules governing joint employment situations that could arise in the multifamily industry.
To learn more about the Joint Employer Rule, please visit our advocacy page.