Skip to content

Search

Latest Stories

Labor Department approves new joint-employer status rules

A four-point test will determine if a company shares responsibility for employees’ wages

THE U.S. DEPARTMENT of Labor has updated the Fair Labor Standards Act to clarify the definition of joint-employer status. It is the first major update to FLSA in 60 years and addresses an issue that has been a point of concern for the hospitality industry.

Companies and individuals that are considered joint employers, meaning they are jointly and severally liable for employees’ wages, are required under FLSA to pay a federal minimum wage plus overtime. The new Labor Department rule first announced in April essentially establishes a four-factor test based on precedent to determine if two entities meet standards that make them joint employers of a shared labor pool.


The test would establish if each company has the power to hire or fire shared employees; supervise and control the employees schedules and work conditions; determine the employees’ rate and method of payment; and maintain the employees’ employment records.

Other factors that may affect joint-employer status are defined in the new rule while specific business models, contractual agreements and business practices that do not make joint employer status more or less likely are included.

“The changes in this final rule break down barriers that keep companies from constructively overseeing, guiding and helping their business partners,” said Cheryl Stanton, the Labor Department’s wage and hour division administrator, in a statement. “For small business owners, and the employees working in those businesses, the relationship and the guidance coming from franchisors and other contracting companies can greatly improve the workplace and help them create jobs.”

A lack of clear standards on joint-employer status has slowed business development and new hiring out of concern by franchisors that they may be assuming responsibility for a franchisee’s employees, said AAHOA President and CEO Cecil Staton in a statement supporting the new rule.

“Over 80 percent of AAHOA members own franchised properties. The franchise business model continues to serve as an onramp to economic empowerment for America’s entrepreneurs,” Staton said. “Returning to the traditional joint employer standard gives owners the peace of mind that they will remain in control of their businesses.”

Much of the confusion over joint-employer status followed a series of decisions by the National Labor Relations Board that is still considering its own rules to clarify joint-employer status. The board’s definition of joint-employer status has been in limbo since Feb. 26, 2018, when the NLRB vacated its 2017 decision in Hy-Brand Industrial Contractors Ltd. and Brandt Construction Co. in response to a court finding that one of the board members had a conflict of interest in that case. As a result, the board’s definition on joint employers under the National Labor Relations Act and the Fair Labor Standards Act reverts to the 2015 Browning-Ferris Industries case, which the Hy-Brand decision had overruled.

On Dec. 28, the U.S. District of Columbia Circuit Court of Appeals’ ruling upheld NLRB’s joint-employer test defined in its 2015 Browning-Ferris decision, saying it was correct to find that a company’s “right to  control  and  indirect  control” could be considered in deciding its joint-employer status. At the same time, it sent the issue back to the board for consideration over the scope of the definition of indirect control.

More for you

Marriott Outdoor Collection

Marriott unveils 'Outdoor Collection'

Summary:

  • Marriott launches Outdoor Collection and Bonvoy Outdoors platform.
  • First two brands are Postcard Cabins and Trailborn Hotels.
  • Platform features 450+ hotels, 50,000 homes and activities.

MARRIOTT INTERNATIONAL RECENTLY launched the brand “Outdoor Collection by Marriott Bonvoy” and introduced “Marriott Bonvoy Outdoors,” a digital platform that lets travelers plan trips by destination or activity. The first two brands in the Outdoor Collection are Postcard Cabins and Trailborn Hotels.

Keep ReadingShow less
Peachtree adds six hotels to its third-party management platform
Photo credit: Peachtree Group

Peachtree picked to manage six hotels

Summary:

  • Peachtree adds six hotels to third-party platform.
  • Five are owned by La Posada Group, one by Decatur Properties.
  • Third-party portfolio totals 42 hotels.

PEACHTREE GROUP’S HOSPITALITY management division added six hotels to its third-party management platform. Five are owned by La Posada Group LLC and one by Decatur Properties Holdings.

Keep ReadingShow less
AHLA Foundation scholarships

AHLA Foundation awards $710K in scholarships

Summary:

  • AHLA Foundation distributed $710,000 in scholarships to 246 students.
  • Nearly 90 percent of recipients come from underrepresented communities.
  • The foundation funds students pursuing education and careers in the lodging sector.

AHLA FOUNDATION DISTRIBUTED $710,000 in academic scholarships to 246 students at 64 schools nationwide for the 2025–2026 academic year. Nearly 90 percent of recipients are from underrepresented communities, reflecting the foundation’s focus on expanding access to hospitality careers.

Keep ReadingShow less
U.S. government shutdown
Photo by Kevin Dietsch/Getty Images

Congressional deadlock shutters government

Summary:

  • The U.S. government shut down at midnight after Congress failed to agree on funding.
  • About 750,000 federal employees will be furloughed daily, costing $400 million.
  • Key immigration and labor programs are halted.

THE FEDERAL GOVERNMENT shut down at midnight after Republicans and Democrats failed to agree on funding. Disputes over healthcare subsidies and spending priorities left both sides unwilling to accept responsibility.

Keep ReadingShow less
WTTC travel report

WTTC: U.S. tops travel sector with $2.6T GDP

Summary:

  • The U.S. led global travel and tourism in 2024 with $2.6 trillion in GDP, WTTC reported.
  • India retained ninth place with $249.3 billion in GDP.
  • The sector supported 357 million jobs in 2024, rising to 371 million in 2025.

THE U.S. LED global travel and tourism in 2024, contributing $2.6 trillion to GDP, mainly from domestic demand, according to the World Travel & Tourism Council. Europe accounted for five of the top 10 destinations, while India ranked 9th.

Keep ReadingShow less