Tag: joint employer

Federal Court Finds That Auto Manufacturer Is Not a Joint Employer Of Dealerships' Workers A federal appeals court has ruled against three employees at car dealerships in California who brought wage and hour claims against a major car manufacturer claiming that they were a joint employer. The court has concluded that these plaintiffs failed to demonstrate that the manufacturer was a joint employer. According to the California Labor Code, an employer is defined as anyone that "exercises control over the wages, hours or working conditions of any person" This can be directly, indirectly, or through an agent. The California Supreme Court has provided three alternative definitions for the term "employ," the first of which is exercising control over an individual's wages, conditions of employment, or hours. The second is suffering or permitting an individual to work, and the third is to engage the employee in such as to establish such a relationship. The plaintiffs argued that the manufacturer's incentive payments for selling vehicles as well as for performance on customer surveys manifested control over wages. However, the court did not agree, finding that the plaintiffs had failed to provide sufficient details on these payments and how much of their compensation these payments manifested. According to the court, these payments must have more than simply an impact on pay. Additionally, the plaintiffs alleged that the manufacturer monitored their job performance through the aforementioned customer surveys, which were used to provide incentive pay. However, the court found that these were only used in a way that influenced the day-to-day management by the dealerships themselves, not the manufacturer. The plaintiffs also alleged that the manufacturer "suffered or permitted them to work" through its requirement that salespeople complete certain required certifications and training. However, without further details as to the frequency and content of these courses, the court concluded that they appear to simply be focused on quality control which is permitted typically without establishing a joint employer relationship. Lastly, the plaintiffs argued that the manufacturer had engaged with them in a way that created a joint employer relationship. However, the court again found that this argument failed to establish that the manufacturer had assumed any general right to control the manner or means by which the plaintiffs sold vehicles. Further, the plaintiffs did not allege that the manufacturer was involved in their daily work experiences. As a result, the appeals court found that the lower court had properly dismissed the case. Employer Takeaways The test for joint employment is often complex, and California's courts have expressed several different points of view on how it should be applied. Though this standard still seems far from being settled, this case still provides a positive precedent for employers. Pre-employ offers resources to help employers stay compliant and incorporate fair chance hiring practices. To learn more, download our free resource 5 Tips To Avoid FCRA Non-Compliance. STAY COMPLIANT WITH YOUR BACKGROUND CHECKS

Tag: joint employer

Federal Court Finds That Auto Manufacturer Is Not a Joint Employer Of Dealerships’ Workers

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