The Essential Guide to Family & Medical Leave

chapter 2 | is your company covered by the FMLA? | 21
Is Your Company a Joint Employer?
There are no hard and fast rules that determine whether your company
is a joint employer. Instead, you must look at all the circumstances of
the relationship between the two companies to determine whether your
company acts like an employer. The main factors to consider are whether
your company:
• has the power to hire and fire some employees of the other company
• has the power to set rates and methods of pay of employees of the other
company
• has the right to supervise the work and work schedules of employees of
the other company, and
• is responsible for maintaining employment records for employees of the
other company.
These factors are hallmarks of a joint employer relationship. No one factor or
combination of factors automatically creates a joint employer relationship.
But as a practical matter, if your company uses temps or employees supplied
by another company, it is probably a joint employer.
Example: Your company, Internet Service Solutions (ISS), operates a customer call
center to service the accounts of customers of an Internet service provider, Internet
View. To find new customer service representatives, ISS hires temporary employees
through a placement service, Techno Temps. ISS supervisors interview prospective
Techno Temps candidates for their departments, choose which to hire, and decide
how much to pay them. If the supervisor likes the Techno Temp employee’s work,
the employee might later be offered a job directly by ISS. If a Techno Temps placement
doesn’t work out, ISS can terminate employment. Currently, 20 of ISS’s customer
service representatives are Techno Temps employees.
In this situation, ISS is a joint employer with Techno Temps because ISS has the
power to hire and fire Techno Temps employees working at ISS, sets their pay rate,
and supervises them on a day-to-day basis. As a result, all joint employees have to be
counted by both ISS and Techno Temps to determine whether the two companies
are covered by the FMLA.