FMLA Joint Employer Ruling

Many of the Federal employment laws do not take into consideration co-employment, joint employment or other employment relationships that involve more than one employer.

Under the Family and Medical Leave Act (FMLA), the U.S. DOL promulgated regulations explaining circumstances where a joint-employment relationship may exist: (a) Where two or more businesses exercise some control over the work or working conditions of the employee, the businesses may be joint employers under FMLA. Joint employers may be separate and distinct entities with separate owners, managers and facilities. Where the employee performs work which simultaneously benefits two or more employers, or works for two or more employers at different times during the workweek, a joint employment relationship generally will be considered to exist in situations such as: (1) Where there is an arrangement between employers to share an employee's services or to interchange employees; (2) Where one employer acts directly or indirectly in the interest of the other employer in relation to the employee; or, (3) Where the employers are not completely disassociated with respect to the employee's employment and may be deemed to share control of the employee, directly or indirectly, because one employer controls, is controlled by, or is under common control with the other employer. 29 C.F.R. § 825.106(a).

A case just decided a few week ago held that for a joint-employer relationship to exist, each alleged employer must exercise control over the working conditions of the employee, although the ultimate determination will vary depending on the specific facts of each case. That case, Moldenhauer v. Tazewell- Pekin Consol. Communications Center, 2008 WL 2927018 (C.A.7 (Ill.)), is a Seventh Circuit case (which covers Illinois, Indiana and Wisconsin).

Cases like Moldenhauer arise where one of the two employers has less than the requisite "50 employees within a 75-mile radius" to come under the purview of the FMLA, but when aggregated to the second company, falls within the applicable number of employees.