What Does Joint Employment Mean for the Construction Industry?

Friday, February 26, 2016

The US Department of Labor has been keenly interested in classifications of employee and contractor, a demarcation that can be specifically challenging in the construction industry where workers are often employed by two, or even more, employers.

Last month, the Department of Labor focused on joint employment with the issuing of the Administrator’s Interpretation of the FLSA and the Migrant and Seasonal Agricultural Worker Protection Act. When it comes to joint employment, in many cases, the worker’s hours are aggregated, which can affect overtime, and all of the worker’s joint employers must comply with FLSA and MSPA. 

Two types of worker-employer relationships can fall under the category of joint employment: horizontal (an employee who works for associated businesses, such as a retail employee working shifts at two locations) and vertical (an employee works directly under one employer who is dependent on another entity). Vertical joint employment can be particularly important for the construction industry where laborers work under sub-contractors, contractors and developers.

Review your employment structure to ensure compliance with these regulations; we’ll be happy to talk with you if you have any questions! Learn more from the NAHB