Multiple Individuals Found to be Employers in FLSA Case Against Construction Companies

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On February 12, 2013, the U.S. District Court for the Eastern District of New York (Leal v Masonry Serv. Inc ., E.D.N.Y., No 1:12-cv-00588, February 12, 2013) held that a construction worker sufficiently alleged that multiple individuals were his “employers” under the FLSA because each had operational control over his work. The Court stated,

“To determine whether an individual defendant is an employer within the meaning of the FLSA, “the overarching concern is whether the alleged employer possessed the power to control the workers in question . . . with an eye to the ‘economic reality’ presented by the facts of each case.” Herman v. RSR Sec. Servs. Ltd., 172 F.3d 132, 139 (2d Cir. 1999) (citations omitted). Under the “economic reality” test, the relevant factors include whether the alleged employer: (1) had the power to hire and fire the employees; (2) supervised and controlled employee work schedules or conditions of employment; (3) determined the rate and method of payment; and (4) maintained employment records. Id. However, these factors are not exclusive. Indeed, under the “economic reality” test, which encompasses the totality of the circumstances, “any relevant evidence may be examined so as to avoid having the test confined to a narrow legalistic definition.” Id. Here, Plaintiff has alleged that the Moving Defendants, in their capacity as owners and directors of construction businesses operating within this district, had the power to hire and terminate employees, control work schedules and conditions of employment, and set wages. Plaintiff’s allegations of operational control, considered together, are sufficient to allege the Moving Defendants’ status as Plaintiff’s employer, as that term is defined under the FLSA and NYLL.”

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