On 01 April 2019, the US Department of Labor announced new rules to clarify join-employer status, marking the first meaningful revision to its regulations since 1958, the DOL underlined. This highly controversial topic is important because it will enable clarity over responsibility for the paying of the minimum federal wage rate as well as overtime hours in situations that include franchising, sub-contracting, and interim work.
The most well known example is the McDonald’s franchise fast food chain where the question arises as to which entity is ultimately responsible for paying the minimum wage rate and overtime hours, McDonald’s or the local franchise? Labor Minister Alexander Acosta holds the answer depends on four criteria, namely the power to:
- Hire or fire the employee;
- Supervise and control the employee’s work schedules or conditions of employment;
- Determine the employee’s rate and method of payment; and
- Maintain the employee’s employment records.
Do you have information to share with us?