The US Department of Labor (“DOL”) announced today that Secretary of Labor Alexander Acosta has withdrawn the DOL’s 2015 and 2016 informal guidance on joint employment and independent contractors. We previously reported on these issues when the guidance was published under the prior Secretary. For more information on the guidance please refer to our posts dated January 28, 2016 and September 29, 2015. The press release cautioned that:
Removal of the administrator interpretations does not change the legal responsibilities of employers under the Fair Labor Standards Act and the Migrant and Seasonal Agricultural Worker Protection Act, as reflected in the department’s long-standing regulations and case law. The department will continue to fully and fairly enforce all laws within its jurisdiction, including the Fair Labor Standards Act and the Migrant and Seasonal Agricultural Worker Protection Act.
What does this mean for employers? Effectively, not a great deal. The Fair Labor Standards Act (“FLSA”) and the Internal Revenue Code provide fairly clear guidance on the independent contractor tests, and other federal agencies such as the National Labor Relations Board (“NLRB”) and the Equal Employment Opportunity Commission (“EEOC”) have spoken to the issue of joint employment.
More importantly, however, many states, including ALL of the New England states, have very restrictive independent contractor laws. Caution should continue to prevail when supplementing one’s workforce with contractors or consults. Similarly, those businesses which utilize temporary workers from staffing companies or share employees with other related companies should continue to assume that those workers will be considered the joint employees of all who direct their performance or benefit from the services.
It is unknown whether the DOL intends to issue any new guidance on either of these topics.