In a recent ruling, a federal district court judge determined that Astronautics Corporation of America may be considered a joint employer along with its subsidiary, Kearfott Corp., for purposes of the Family and Medical Leave Act (FMLA). The case, Duncan v. Kearfott Corp., involves allegations of wrongful termination filed by an HR manager against Kearfott Corp. The decision by the court highlights the concept of joint employment and its potential implications under employment laws.
Background
The lawsuit was initiated by an HR manager at Kearfott Corp., who claimed that she was terminated shortly after requesting time off to care for a family member. Astronautics Corporation of America, the parent company of Kearfott, sought to dismiss the claims against it, arguing that it was not the plaintiff’s employer and, even if it were, it was not involved in the termination decision.
The parent company’s argument
Astronautics Corporation of America denied being the plaintiff’s employer and asserted its lack of involvement in the termination decision. The company argued that it should not be held liable for the alleged misconduct as it was a separate entity from Kearfott.
Court’s ruling
The court disagreed with Astronautics Corporation of America’s arguments and allowed the employee’s claims to continue. The judge determined that there was sufficient evidence to suggest a joint employment relationship between the two companies. Specifically, the allegations of interrelated HR operations and the involvement of a shared VP in the termination decision were deemed significant enough to support the employee’s claims.
Joint liability under the FMLA
The FMLA, like many employment laws, allows for joint liability. Department of Labor (DOL) regulations that implement the law specify situations in which joint employment may be found. These include cases where there is an arrangement between companies to share an employee’s services or interchange employees, an employer acts in the interest of the other employer in relation to the employee, or the employers are not completely disassociated with respect to the employee’s employment.
Evidence of joint employment in the Duncan case
In the Duncan v. Kearfott Corp. case, the two companies allegedly maintained connected HR operations and shared senior managers. The lawsuit’s complaint stated that the VP of administration for Astronautics directly oversaw the hiring of management personnel at Kearfott. These key details provided substantial support for the claim of a joint employment relationship between the two entities.
Common situations for joint employment claims
It is worth noting that joint employment claims can arise in a variety of scenarios, often involving staffing arrangements or franchise agreements. In these situations, multiple entities may exercise control over an employee’s working conditions, leading to potential joint liability.
The ruling in Duncan v. Kearfott Corp. serves as a reminder of the importance of understanding the concept of joint employment in employment law. The court’s decision implies that parent companies, like Astronautics Corporation of America, may be held liable as joint employers under the FMLA if evidence suggests an arrangement or connection that establishes joint employment. Employers should be aware of the potential consequences and implications of this ruling, especially in cases where they operate as parent companies or have interconnected HR operations.