Edward M. Yennock, Member of the Firm in the Employment, Labor & Workforce Management and Litigation practices, in the firm’s New York office, authored an article in the Employee Relations Law Journal, titled “Time Is Money: A Quick Wage-Hour Tip on New York’s New Rule on Contractors’ Liability for Subcontractor Employee Wages.”
Following is an excerpt (see below to download the full version in PDF format):
The doctrine “joint employer” liability has received significant attention in recent months. Under the Fair Labor Standards Act (“FLSA”), an employee may be deemed to have multiple employers – each of whom would be liable jointly for all aspects of FLSA compliance, including with regard to the payment of wages – in connection with his or her performance of the same work.
During the prior administration, the U.S. Department of Labor (“DOL”) issued a rule intended to standardize the parameters of joint employer liability. Months later, however, a federal court invalidated a portion of the new rule, holding that it impermissibly narrowed the scope of the joint employer doctrine. And, in July 2021, the DOL announced its outright repeal of the rule – i.e., whether a business might face joint employer liability will again be governed by the multi-factor “economic reality” test subject to varying judicial interpretations.
An important new development in New York law, however, essentially renders the concept of joint employment, and the standards that govern it, a moot point – at least in terms of wage liability in the construction industry.
