Dive Brief:

• The Labor Department yesterday attempted to clarify the controversial issue of joint employment by beginning to sort out which entity should be liable for employment law violations if two different entities are connected to same worker, according to the New York Times.
• The Times reports that the DOL made public its guidance just as a very important case "that raises similar questions" will shortly be before an administrative law judge.
• In that litigation, the outcome will decide if McDonald's Corporate is a "joint employer" and if so, whether that automatically means it shares the blame (and the legal consequences) for "alleged labor violations" happening at a number of its franchised restaurants.

Dive Insight:

David Weil, the administrator of the Labor Department’s wage and hour division (WHD), told the Times that there are "misconceptions" in the business community, both intentional and unintentional, about their actual responsibilities. And as many of these industries become more complex, some of those misconceptions have increased.

The Times article also mentioned a blog post where the Weil noted the increase in "arm's length" worker situations, and discussed recent decisions won by the DOL on behalf of workers. In one, involving DirecTV, a federal court in Washington State found the satellite company to be a joint employer of contractor-hired installers. In another, J & J Snack Foods paid $2 million in back wages and damages to employees hired by two staffing firms J & J used.

For now, the issue will continue to be sorted out in the courts, but employers and HR leaders probably should consult with employment counsel to know where they stand relative to contracts with contractors or vendors who supply workers.