Mass. Supreme Judicial Court adopts FLSA ‘joint employer’ test

A defendant company that entered into a subcontract for regional direct sales services for its national clients could not be held liable under the Massachusetts wage laws as the “joint employer” of plaintiffs who worked as salespersons for that subcontractor, the state Supreme Judicial Court has decided.

“This case presents the issue whether G.L.c. 149, §148B (independent contractor statute), which sets forth the standard to classify an individual as an employee or an independent contractor for purposes of the minimum wage and overtime statutes, G.L.c. 151, §§1 and 1A (wage laws), also establishes the standard to determine whether an entity is that individual’s joint employer for purposes of those laws,” Justice Dalila A. Wendlandt wrote for the unanimous SJC.

The court concluded that it does not.

Instead, the court borrowed the test applied to determine joint employer status under the Fair Labor Standards Act, “from which the Massachusetts wage laws derive,” Wendlandt stated.

“Pursuant to that test, whether an entity is a joint employer of an individual is determined by considering the totality of the circumstances of the relationship between the individual and the entity, guided by a framework of four factors: whether the entity (1) had the power to hire and fire the individual, (2) supervised and controlled the individual’s work schedules or conditions of employment, (3) determined the rate and method of payment, and (4) maintained employment records,” she wrote.

The plaintiffs were salespeople directly retained by DFW Consultants, an entity with which the defendant, Credico (USA) LLC, subcontracted to provide regional direct sales services for its national clients.

“The record, when considered in view of the aforementioned factors as a whole, does not support the conclusion that the plaintiffs had a reasonable expectation of proving that Credico exercised the type of control over their employment necessary to conclude it was their joint employer,” Wendlandt said.

The 33-page decision is Jinks, et al. v. Credico (USA) LLC.