The Department of Labor (DOL) is cracking down on companies that cheat temporary workers out of overtime wages and other benefits through joint employment endeavors with temporary staffing agencies.
The DOL’s Wage and Hour Division Department has set new guidelines to ensure that host employers and temporary staffing agencies are both responsible for following labor and employment laws with regards to temporary employees.
David Weil, the Director of the Wage and Hour Division, believes that most of the noncompliance from companies stems from them being unaware of their responsibilities. Still, he admits that some companies, “are clearly playing games, and clearly trying to shift out responsibility, and often have structured things in a way that lead towards more noncompliance.”
Joint employment is most often a “vertical” arrangement, meaning one company hires workers from another company. But joint employment can also be a “horizontal” arrangement, where workers are hired by two subsidiaries of the same company. This can result in workers losing benefits, like overtime wages, since their hours are tracked separately.
Last year, temporary workers in New Jersey were cheated out of overtime wages at a snack food production company. In October, investigators ordered the company to pay the temp workers their appropriate back wages, plus damages and civil penalties.
Issues with labor law noncompliance is a common occurrence in many industries, such as shipbuilding, construction and agriculture, as these businesses continue to outsource, subcontract, and use staffing agencies to help keep their overhead costs down.
By outsourcing employment needs, many companies feel they are exempt from following labor laws, and they believe the temporary staffing agency is responsible for upholding the employees’ legal rights. Yet, regardless of how temporary employees are hired, both companies have joint responsibility for the workers.
If you have been the victim of a workforce labor law issue, the skilled employment law attorneys atPhillips Law Group have helped countless workers receive maximum compensation for breaches in overtime pay and other injustices. Contact us today for an evaluation.
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