Great News Regarding Joint Employer Status
June 08, 2017
New leadership at the Department of Labor has withdrawn two guidance letters that had been in effect from the past administration that previously sought to make “joint” employers, especially in the franchisor/franchisee setting. The prior guidance letters had been utilized by the NLRB in finding a joint employer relationship existed for franchisee employees and the franchisor/parent company. This is great news for all businesses, as joint employer status hurt small franchisees who often did not meet the 50 employee test unless coupled as a joint employer with the franchisor, thus triggering application of many federal laws applicable only to employers with 50 or more (e.g. FMLA) This withdrawal also benefits those employers who utilize mandatory alternative dispute resolution programs to resolve employee claims and issues, as the franchisor cannot now be drawn in to such conflicts.
Stayed tuned for more updates on this topic.
Robert L. Roark, Esq.
National Program Director
EDR Systems
This information is the opinion of the writer and is not meant to be construed as creating an attorney-client relationship or as legal advice to an individual or business. Please consult your attorney if you need legal advice on the issues above.