Many modern workplaces are arranged as a dizzying web of separate but related entities, including subsidiaries, contractors, subcontractors, and staffing agencies. That can make it difficult for workers to determine who is legally to blame when they are ripped off or shortchanged on the job.
Here is what you need to know: California law allows workers to go after two or more entities as joint employers. This is common in situations where workers are hired and paid by one entity but perform work for or are directed by another. Such arrangements are prevalent in construction, hospitality, delivery, home care, and factory jobs. They are also increasingly seen in white-collar office jobs, including in the tech industry.
Sadly, many employers create complicated staffing and contract arrangements specifically to reduce their legal obligations to workers. When workers’ rights are violated on the job, the entities that actually call the shots try to point fingers at others and claim they are not responsible because they are not the workers’ employers.
The good news for people working in California is that state law is designed to cut through the noise. The law holds the entities that truly direct the work and set the terms and conditions of the job accountable for properly paying workers and ensuring that their workplaces are safe and free of discrimination and harassment.
At Justice Law Corporation, our California employment class action attorneys help working people in California ensure that they are fully paid and protect their rights on the job. We are seasoned litigators with a strong track record of holding large companies and other employers accountable, in and out of court.
Here is what you need to know about joint employment and enforcing your rights on the job.
What is Joint Employment?
More than one company may be considered your employer under California law. Joint employment happens when two or more businesses share legal responsibility for a worker’s employment.
Some of the most common joint employment situations include:
- A worker is hired through a staffing agency but works at another company’s location.
- A subcontractor supplies workers to a general contractor.
- A franchisee runs a location that follows policies set by a larger franchisor.
- A labor contractor provides workers to farms, warehouses, or factories.
Workers in these arrangements may technically be hired by one entity but still take direction from another. If both businesses exercise enough control over the work, they can both be responsible for complying with various labor and employment laws.
If two or more businesses are determined to be joint employers, that means they are each legally responsible for complying with laws related to:
- Minimum wages and overtime pay
- Meal and rest breaks
- Discrimination and harassment
- Workplace safety
- Employee organizing
- Workers’ compensation
- Retaliation
When joint employment exists, the law typically holds the companies jointly and severally liable. That means each employer can be responsible for the full amount of wages or damages owed to the worker.
Joint employment is a critical part of protecting workers’ rights because it prevents companies from avoiding responsibility by outsourcing labor. Otherwise, a large company could hire workers through smaller contractors and claim it has no responsibility if those workers are underpaid, denied breaks, or harassed at work.
Joint employment also helps ensure workers are compensated when their rights are violated. It prevents situations in which fly-by-night staffing agencies and contractors suddenly go out of business instead of paying workers what they are owed. Instead, those workers can also bring their claims against larger employers with more resources, which often create the policies that caused them harm in the first place.
How to Prove Joint Employment
California courts look at several factors to determine whether multiple entities are joint employers. The key factor is whether each entity exercises control over the worker or the working conditions.
The analysis varies based on the specific circumstances, but courts tend to focus on whether an entity:
- Controls the worker’s schedule or hours
- Directs how the work is performed
- Sets pay rates or compensation policies
- Supervises or disciplines workers
- Has the power to hire or fire workers
- Requires workers to follow its workplace policies
No single factor determines the outcome. Instead, courts look at the overall relationship between the worker and the companies involved. In some cases, they have found that businesses exert indirect pressure on other businesses, resulting in a joint employment relationship.
Workers bringing joint employment claims often rely on a variety of evidence to show that multiple companies controlled their work. Such evidence may include:
- Work schedules and shift assignments
- Written policies or employee handbooks
- Text messages or emails from supervisors
- Time records or pay stubs
- Testimony from coworkers
- Contracts between companies
These records can help show which companies were directing the work and setting the employment conditions.
Joint Employment and Misclassification
The joint employment concept is often confused with worker classification. The issues are similar in that they both involve employers using layers of contracts and other arrangements to skirt their responsibilities to workers.
Joint employment addresses the question: Who is my employer? Worker classification addresses the question: Am I an employee?
Far too many employers in California and across the country wrongly classify workers as independent contractors rather than employees. Independent contractors are not covered by minimum wage and overtime pay requirements, protections against discrimination and harassment on the job, and workplace safety rules. They are also not eligible for workers’ compensation if injured on the job or for unemployment insurance if laid off.
The good news is that employers cannot simply choose who is an employee and who is a contractor. California law strictly limits who can be classified as a contractor to people who truly perform their jobs independently.
Sometimes, joint employment and worker classification issues overlap. For example, a person hired by a staffing company to work at a warehouse may argue that both the agency and the warehouse operator are their employer. If the person is wrongly classified as an independent contractor, they can also challenge that status in court.
The approach to both joint employment and worker classification by federal agencies such as the Labor Department and the National Labor Relations Board has shifted back and forth with the political winds over the last two decades. Fortunately, the approach in California has not changed.
Class Actions Against Joint Employers
Many wage and other cases against joint employers stem from policies and practices that rip off groups of workers. Class actions are a powerful tool that allows working people to join together to fight back in these situations.
Class actions are lawsuits in which groups of workers pursuing similar claims sue their employers collectively. They can be used to go after multiple entities as joint employers.
Take, for instance, a warehouse that employs hundreds of workers hired and supplied by a staffing agency. If those workers log more than 40 hours on the job in a week and are not paid overtime rates, they can bring a class action against both the staffing agency and the warehouse owner.
Joint employment rules ensure that the companies benefiting from that labor cannot avoid responsibility simply by outsourcing hiring. Class actions help workers leverage their claims to force joint employers to comply with employment laws.
Our California Employment Class Action Attorneys Can Help
If you believe that your employer is violating your rights on the job, whether it is by being underpaid or in other terms and conditions, you do not need to go it alone. A California employment class action attorney at Justice Law Corporation can help you evaluate your claim and understand your rights and options.
Our office is conveniently located in Pasadena. Contact us at (818) 230-7502 to schedule a free consultation with a California employment class action attorney.
