Joint Employer Determination Rule gets one-week extension

The U.S. Department of Labor is keeping the 2020 Joint Employer Determination Rule in place until Oct. 5, 2021, a move that basically extends the rule’s end date by an additional week.

The Labor Department earlier this year announced it was scrapping the rule effective Sept. 28, 2021. The DOL has now extended the date to Oct. 5.

Joint employment or co-employment situations arise when two or more organizations share control and supervision of one or more employees.

Joint employers are responsible for complying with labor and employment laws, including the Fair Labor Standards Act, and the DOL makes joint employment determinations to prevent scenarios where one employer uses another as a “shield” to avoid compliance obligations. 

The DOL says it needed to get rid of the Joint Employer Rule because it “improperly narrows the test for vertical joint employment and conflicts with decades of DOL interpretation, the text of the (Fair Labor Standards Act), and Congressional intent.” 

The DOL also considered the fact that a federal court vacated most of the rule in September 2020. Among the reasons the court vacated the provision was that it found the rule deviated from prior guidance without explaining why.

Employers should comply with the parts of the 2020 Rule that remain in effect until Oct. 5, 2021. After this date, the 2020 Rule will be removed in its entirety, leaving room for previous joint determination guidance to apply.