U.S. Labor Department Clarifies Overtime Rules For Joint Employers
The U.S. Department of Labor (DOL) has issued a new opinion letter that clarifies how employee overtime must be calculated in instances where employees work for two related businesses that qualify as joint employers under the Fair Labor Standards Act (FLSA). Specifically, DOL determined that when businesses are sufficiently connected — they share management, facilities, or scheduling, for example — an employee’s hours across both organizations must be combined for overtime purposes.
The agency emphasized that formal corporate separation does not automatically shield employers from joint liability. Instead, the DOL indicated that in future cases it will look at the “economic realities” of the joint employers’ relationship, including whether they share control over employees, coordinate schedules, or jointly determine pay rates.
Read the full opinion at this link.