Paul DeCamp, Member of the Firm in the Employment, Labor & Workforce Management practice, in the firm’s Washington, DC office, was quoted in the Bloomberg BNA Daily Labor Report, in “Pending ‘Joint Employer’ Rule Raises Questions of DOL Authority,” by Jaclyn Diaz. (Read the full version – subscription required.)
Following is an excerpt:
The Labor Department hasn’t yet issued a new regulation on the controversial issue of shared employer liability in franchise and staffing arrangements, but there are already questions in some quarters about how well the policy change could hold up in court.
The DOL plans to update current regulation by the end of the year. The policy would govern “joint employer liability,” or when multiple businesses share legal responsibility for minimum wage and overtime violations by their partners.
Some lawyers say the department doesn’t have the power under the language of the Fair Labor Standards Act to make a rule legally binding. Others insist it does.
What’s the Power in Court?
Under federal law, an agency’s rule can be categorized as interpretive or legislative. Judges usually defer to legislative regulations, those enacted as part of authority Congress gives an agency when it is writing laws. Interpretive regulations may not have the same weight in the courtroom. …
It’s possible the proposal could be subject to a legal challenge early on to try to stop DOL from issuing the rule as a legislative regulation, said Paul DeCamp, co-chair of Epstein Becker Green’s national Wage and Hour group. DeCamp was also an administrator for the DOL’s Wage and Hour Division under the Bush administration.
DeCamp said a challenge of the regulation will more likely arise in a specific dispute over minimum wages and overtime. That’s when courts may be asked to apply the regulation.
“The real test of the rule” will depend on the level of deference a court decides to give the rule, he said. …
Its Internal Usefulness
The bottom line is that the big question of joint employer doesn’t have any easy answers, DeCamp said.
“The department is doing as much as it can do. The rest is up to Congress. It would be more definitive if Congress passed statutory language on the issue, but unless they do, the department’s best action is to issue regulation,” he said.