Joint employment

Joint employment differs from the PEO industry's use of co-employment. Co-employment describes a contractual service arrangement; joint employment is a conclusion courts and agencies reach under specific statutes (the FLSA, the NLRA, state wage laws) based on control over hiring, firing, supervision, pay, and working conditions. The tests differ by statute and have shifted with rulemaking over the years.

The practical point for a PEO buyer: labels in the service agreement do not decide joint employer questions, conduct does. A client that directs day-to-day work generally remains the employer for wage and hour purposes regardless of whose name is on the paycheck. Treat any claim that a PEO arrangement shields you from employment liability with skepticism, and ask which party defends and pays for which claims.