Not long after Elon Musk paid billions to acquire a majority interest in Twitter, the company laid off over half its workforce. Many of those laid off were contract workers supplied by TEKsystems Inc., a staffing firm. In the aftermath Twitter is facing a proposed class action lawsuit alleging it failed to provide these workers with 60 days advance notice of their layoffs, as required under the federal WARN Act and California state law. One might ask how contract workers employed by a third-party staffing company can sue Twitter under laws that provide rights to “employees.” The fact is that this is commonly done in many different contexts, under many different employment laws beyond WARN, and not just in California. The lawsuit names both Twitter and TEKsystems Inc. as codefendants, alleging the two entities are “joint employers.” The outcome of this recently filed lawsuit is unknown. Regardless, it serves to remind business owners, managers and their advisors that simply because contract workers are supplied by a separate company, the entity contracting for their services may nevertheless be regarded under workplace laws as their joint employer. Those businesses that assume they are not subject to employment laws for workers hired, paid, and considered “employed” by long-term staffing, temp-to-hire, or other third parties, do so at their own peril.

Wessels Sherman attorneys frequently advise businesses that utilize contract workers, and staffing agencies or temp services that supply those workers. Our lawyers also defend against joint employer claims commonly asserted in contract worker relationships. Whether two separate entities are “joint employers” under various state and federal laws, is typically determined by the details of the parties’ relationship and roles each plays with respect to workers. Because joint employers can face joint liability for employment law violations, it is critical that these details be worked out up front, before lawsuits arise. 

Questions? Contact attorney James Sherman at: 952-746-1700 or by email.