Joint-Employer Rule, Colorado Wage Changes Launch March 16

The federal test to determine a joint-employment relationship was revised and Colorado’s wage and hour requirements also were overhauled under federal and state rules that are to take effect March 16, requiring employer vigilance and compliance amid emergency planning to combat the coronavirus.

Federal Test Takes Effect

Whether more than one entity may be considered a worker’s employer and held equally liable for any wage and hour violations hinges on a four-factor test under the Labor Department’s joint-employer final rule (RIN 1235-AA26), which is to take effect March 16.

The four-factor test considers whether the potential joint employer hires or fires employees; supervises and substantially controls work schedules and employment conditions; determines wage payment rates and methods; and maintains employment records. The final rule also specifies that economic dependence does not determine joint employer status under the federal Fair Labor Standards Act.

Employers that bring on temporary employees provided by a staffing agency to supplement staffing shortages, possibly related to the virus, which causes the respiratory disease COVID-19, or other public health emergency, should bear in mind the joint-employer final rule, the Labor Department said in question and answers that appear on its website and is related to virus contingency planning. Employers determined to be joint employers could be held jointly and individually responsible if the temporary workers are not properly paid, it said.

The final rule is available at the Labor Department’s Wage and Hour Division, along with a set of frequently asked questions and answers and examples.

State Wage-Law Overhaul

Colorado wage and hour requirements were significantly adjusted under a rule (7 CCR 1103-1 2020) that also is to take effect March 16 and that broadens the scope of wage and hour protections, clarifies rest-break requirements, increases lodging credits, allows fluctuating work-week calculations, and amends rules for a wage poster.

The Colorado Overtime and Minimum Pay Standards Order No. 36 replaces the Colorado Minimum Wage Order and, specifically, Minimum Wage Order No. 35, which has been in effect since Jan. 1, 2020.

Among the changes that are to take effect March 16: fluctuating work-week calculations are allowed as long as employees are paid the required overtime in addition to their weekly salary; rest periods are required for four-hour periods; and lodging credit limits would rise to $100 from $25 for a private apartment or house. The taxi-driver and student-worker exemptions also were clarified.

Order No. 36 also presumes all employees generally covered by state wage and hour law unless specifically excluded, starting March 16. Existing law since the 1980s has covered four broadly defined industries: retail and service, food and beverage, commercial support service, and health and medical.

The Order 36 poster that employers must display is available along with guidance from the state Division of Labor Standards and Statistics, which addresses how the state labor agency applies and interprets relevant laws and regulations as related to the final rule (Info No. 1).