Transportation Brief: Ongoing Developments with the FLSA Joint Employer Rule

by Kelli M. Block, A. Jack Finklea

November 2, 2020

Earlier this year, the US Department of Labor (DOL) implemented a Final Rule providing direction on joint employer liability for federal wage and hour violations. The Final Rule focuses on whether the alleged joint employer exercises control over the terms and conditions of the work and essentially eliminates consideration of economic dependence on the alleged joint employer.

On September 8, 2020, a federal district court deemed much of the Final Rule invalid, finding (1) the Final Rule conflicts with the expansive definition of “employer” under the FLSA and (2) the DOL failed to justify the Final Rule’s departure from prior DOL guidance.

Whether the DOL appeals the court’s decision may rest on the results of the upcoming election. In the interim, companies should carefully evaluate the relationship they may have with their subcontractors’ employees (i.e., fleet drivers in the motor carrier context) to avoid costly potential liability.

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