There are many ways in which an employer could face liability for an employee’s workplace experience. Safety issues, discrimination, and equal pay immediately come to mind. It is equally likely that an employer will be ensnared in the ‘co-employment trap’. These are situations in which two employers can be held equally liable for the welfare of the same employee due to a loophole in the terms of their contract with another or in the manner in which the worker is managed.
Factors that may be deemed to create a joint employer relationship:
Apart from these, the agreement between the two parties could also specifically set out the contractual relationship as a joint employment agreement. This would make both parties liable for any contravention of regulations – in the wage and hour matters as well as for discrimination.
When evaluating potential co-employment situations, the FLSA considers “economic reality rather than technical concepts to be the test of employment.” To avoid co-employment claims, clarify the agreement in writing and then train supervisors on the ‘do’s and don’ts’ when dealing with contract workers:
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