A new decision by the Massachusetts Appeals Court “significantly broadens when one entity may be found to be a ‘joint employer’ of another entity’s employees under state wage laws,” according to Joshua D. Nadreau, regional managing partner and vice chair of the Labor Relations Group at law firm Fisher Phillips.
In an opinion issued Thursday, the court ruled in Tran v. Jennings Road Management Corp. that the company was a joint employer of Sakiroh Tran, a parts adviser at a Boston-area car dealership.
The court applied the totality of the circumstances test from a 2021 state Supreme Judicial Court opinion, finding that JRM “exercised substantial control over the conditions and economic aspects of Tran’s employment, thereby meeting the criteria for joint employment,” Nadreau said.
In doing so, according to the attorney, the appeals court interpreted the concept of joint employment “quite broadly.”
Federal joint employer rule in court
This ruling comes as federal courts weigh the merits of a federal joint employer rule finalized by the National Labor Relations Board in October; it called for rescinding and replacing the one promulgated in 2020 under the previous board.
Senior living and care industry representatives previously told McKnight’s Senior Living that the new rule was “much broader and more vague” than the previous rule and would present greater risk for employers that contract with services providers, “creating greater liability for the actions of others.”
The new rule was set to go into effect March 11, but a federal judge vacated the rule March 8 in response to a US Chamber of Commerce-led lawsuit, saying that the new rule “would be contrary to law” and that the rescission of the 2020 standard would be “arbitrary and capricious.”
That ruling was appealed by the NLRB in May.
For now, the decision by the US District Court for the Eastern District of Texas invalidating the rule remains in effect pending the results of the appeal, although a plaintiff in the lawsuit called a recent court ruling a “significant procedural win.”Last week, the AFL-CIO and the Service Employees International Union petitioned the NLRB to rescind the 2020 joint employer rule but also back off on trying to implement a replacement, instead letting the issue flow through adjudication.
