California’s New Definition of Joint Employer under the California Family Rights Act Regulations

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California’s New Definition of Joint Employer under the California Family Rights Act Regulations

The California Family Rights Act (CFRA) regulations, issued by the California Fair Employment and Housing Council, were amended as of July 1, 2015, and contain several noteworthy revisions. As a whole, the resulting provisions are in greater conformity with the federal Family and Medical Leave Act (FMLA). Both the CFRA regulations and FMLA apply to employers with 50 or more employees.

California’s-New-Definition-of-Joint-Employer-under-the-California-Family-Rights-Act-Regulations-300x179The CFRA provides a new definition of “joint employer” which is substantially similar to that issued by the FMLA. The FMLA identifies a joint employer as two or more businesses asserting joint control over the employment of an employee either (i) in connection with an arrangement to share or interchange employees; (ii) where there is unified control over the employee; or (iii) where each employer acts in the interest of his co-employer in relation to the employee.

However, the amended CFRA definition adds the following caveat: namely, that the existence of a joint employment relationship is determined by looking at the relationship “in its totality based on the economic realities of the situation.” There are no other factors provided for establishing the existence of a joint employer relationship.

The relevant issue is whether temporary, part-time or contract employees should be counted when determining if the 50-employee threshold is met, such that the business must comply with CFRA regulations? If both employers are deemed to be “joint employers,” then both employers must count those individuals as employees. Under the amended CFRA regulation, the “economic realities test” (based upon California law) should be applied to resolve this question. Thus, if the employee is engaged in work that benefits two employers at the same time or the employer performs work for two or more employers at different times during the workweek, the situation is likely to be characterized as a joint employment relationship.

If you are an employer in California, it is important to stay informed about various legal reforms. DeAnn Flores Chase and her team of experienced attorneys can offer practical advice for complying with current legislation. Contact Chase Law Group, P.C. at (310) 545-7700 or visit www.chaselawmb.com to schedule a consultation.