Nursing home wasn't joint employer with staffing firm, 6th Cir. finds

Dive Brief:

A physical therapist assistant could not prove a nursing home employed and therefore retaliated against her after she reported sexual harassment, the 6th U.S. Circuit Court of Appeals ruled (Nethery v. Quality Care Investors, No. 19-5499 (6th Cir. May 28, 2020)).
Thomila Nethery worked at a nursing home operated by Quality Care Investors, which contracted with the firm that hired Nethery, Reliant Management Group. Nethery reported her supervisor, also a Reliant employee, for sexual harassment. The firm investigated the claims and ultimately fired the supervisor. Soon after, Quality Care's administrator complained that Nethery was not "a good fit" for the facility, a move that Nethery claimed was retaliation for her complaint. Reliant offered to transfer Nethery out of state and terminated her when she declined.
Nethery sued Quality Care alleging retaliation in violation of Title VII of the Civil Rights Act of 1964, but a district court ruled Quality Care was not a joint employer for purposes of Title VII as it lacked control over her employment opportunities with Reliant. The 6th Circuit affirmed, noting that "the only evidence that Quality Care had the ability to directly fire Reliant employees is the testimony of Nethery [and another Reliant employee] that Mullins told them she could remove anyone she wanted."

Dive Insight:

Retaliation claims arise frequently, as most employment laws have a retaliation provision. Joint employment cases are also common, as employment status is an important consideration when courts assess claims under statutes such as Title VII, the Fair Labor Standards Act (FLSA) and the National Labor Relations Act.

While this topic is important, it’s just as confusing. Different laws and courts impose different standards for defining joint employment status, complicating compliance for employers.

However, stakeholders have seen some streamlining this year. The U.S. Department of Labor (DOL) limited joint employer liability under the FLSA in regulations published in January. The rule largely adopted the "four-factor balancing test" the agency proposed earlier, in addition to clarifying that an employee’s "economic dependence" on an employer does not determine employment status.

The National Labor Relations Board (NLRB) then published a final rule in February stating that an entity may be considered a joint employer of another employer's employees only if it possesses and exercises substantial direct and immediate control over the employees' essential terms of employment. The change brought a possible end to employers' "five to six year nightmare" over joint employer liability under the NLRA, one attorney previously told HR Dive in an interview.