Harrisburg, Pa. – The Pennsylvania Department of Labor & Industry (L&I), under Governor Josh Shapiro’s leadership, today announced it is leading a coalition of 22 states, including 20 attorneys general and 6 additional state labor departments, in opposing a proposed joint employment rule by the U.S. Department of Labor that would weaken worker protections and make it harder to hold employers accountable for wage theft and other labor law violations.
The proposed rule would narrow the standard for determining joint employment under the Fair Labor Standards Act, Family and Medical Leave Act, and Migrant and Seasonal Agricultural Worker Protection Act. Joint employment means a worker may have more than one employer legally responsible for complying with worker protection laws. This can happen in many different workplaces such as two restaurants with common management who share employees, or a general contractor who uses sub-contractors and both control the work of employees.
The coalition’s comment urges the U.S. Department of Labor to withdraw the proposal, warning that it would make it harder for workers to recover unpaid wages, create confusion for employers and enforcement agencies due to conflicts with federal case law, and revive a modified version of a 2020 standard that was struck down by a federal court.
“Governor Shapiro has made clear that Pennsylvania will stand up for workers and push back when federal actions threaten their paychecks and their rights to be treated fairly on the job,” said L&I Secretary Nancy A. Walker. “This proposal would make it easier for companies to avoid responsibility when wage theft or other violations occur. Workers should not be left with less money in their pockets because an employer hides behind a contractor, staffing agency, or other intermediary. The Shapiro Administration is proud to be leading this coalition and will continue fighting to make sure workers are paid what they are owed and that employers who follow the law are not undercut by those who do not.”
Joint employment standards are especially important in today’s economy as more businesses use staffing agencies, subcontractors, labor brokers, franchise arrangements, third-party management companies, or other layered employment models. When violations occur, a smaller intermediary employer may be unable to pay workers or may disappear entirely. A strong joint employment standard helps ensure workers can recover unpaid wages from the businesses that benefited from their work and had control over the conditions of employment.
The coalition argues that the proposed rule does not reflect the reality of modern workplaces, including industries where workers may be directed, monitored, scheduled, or evaluated by more than one business. The proposed rule would have an especially harmful impact on workers in low-wage and high-violation industries, including farmworkers and people working in construction, where labor brokers, staffing agencies, and subcontractors are often used to meet workforce demands.
Additional states and agencies joining Pennsylvania in the coalition include the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Carolina, Oregon, Rhode Island, Vermont, Virginia, Washington, Wisconsin, and the District of Columbia, as well as the state labor departments of Illinois, Maine, Minnesota, Oregon, Virginia, and Washington.
Key Points from the Coalition Comment
The coalition is pushing back on the proposed rule in several ways, arguing:
- The proposed rule would weaken worker protections by narrowing the joint employment standard under federal laws that protect minimum wage, overtime, family leave, and migrant and seasonal agricultural workers;
- The proposal would make wage theft harder to remedy by making it harder for workers to recover unpaid wages when an intermediary employer cannot pay or disappears; and
- The rule would create confusion for employers and enforcement agencies by conflicting with federal case law and reviving a modified version of a 2020 standard that was struck down by a federal court.
Pennsylvania’s leadership in organizing the coalition reflects the Shapiro Administration’s ongoing commitment to protecting workers and enforcing labor laws. As Attorney General, Governor Shapiro led several multi-state actions opposing a similar joint employment test under the Fair Labor Standards Act, including the 2020 multi-state litigation that resulted in the 2020 rule being vacated.
Pennsylvania Will Continue Protecting Workers
L&I’s Bureau of Labor Law Compliance enforces Pennsylvania labor laws, including the Pennsylvania Minimum Wage Act, Wage Payment and Collection Law, Prevailing Wage Act, Construction Workplace Misclassification Act, and Child Labor Act. Workers who believe they have experienced wage theft or other labor law violations may submit a complaint through the online form on L&I’s website.
For more information on the Pennsylvania Department of Labor & Industry, please visit the website or follow L&I on Instagram, Facebook, X, and LinkedIn.
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