AG James Files Suit To Stop Trump Administration From Stripping Workers Of Key Labor Protections

Unlawful Department of Labor Rule Will Increase Wage Theft for New York Workers 

NEW YORK-- New York Attorney General Letitia James and Pennsylvania Attorney General Josh Shapiro today led a coalition of 18 attorneys general in filing a lawsuit to stop the Trump Administration from eliminating key labor protections for workers. 

The lawsuit challenges a U.S. Department of Labor (USDOL) rule that seeks to unlawfully narrow the joint employment standard under the Fair Labor Standards Act (FLSA). The FLSA is the federal law establishing a baseline of critical workplace protections, such as minimum wage and overtime, for workers across the country. The joint employment standard determines when more than one employer is responsible under FLSA because both exert sufficient influence over a worker’s employment. This change would undermine critical workplace protections for the country’s low-and middle-income workers and could lead to increased wage theft and other labor law violations. 

“The new rule, which would result in lower wages and additional wage theft targeting lower- and middle-income workers, demonstrates that the Trump Administration does not care about the hardworking individuals that help this country run,” said Attorney General James. “My office will continue to fight to ensure workers across New York, and across the country get the wages they deserve.”  

The coalition asserts that the rule directly undermines Congress’ intent for the FLSA, and that the USDOL violated the rulemaking process requirements. Further, they argue that the rule would impose significant regulatory burdens on states and harm states’ economies and residents. The coalition is urging the court to declare the rule unlawful and invalidate the rule.  

Over the past few decades, businesses have increasingly outsourced and subcontracted many of their core responsibilities to intermediary entities, instead of hiring workers directly. Because these intermediary entities tend to be less stable, less well-funded, and subject to less scrutiny, they are more likely to violate wage and hour laws. In the suit, the coalition argues that USDOL’s new rule provides an incentive for businesses to offload employment responsibilities to smaller companies, which, under the new rule, will shield them from federal liability for wage and hour obligations under the FLSA. This will result in lower wages and increased wage theft for workers, especially for workers in low-wage jobs. Further, the new rule will make it more difficult to collect unpaid back wages for workers.  

The new rule, the complaint argues, is incompatible with the text of the FLSA and Congress’ purposes in passing it to protect workers from unscrupulous employers. The rule also violates the law by attempting to overturn a 75-year-old Supreme Court precedent via regulation.  

The suit was co-led by New York and Pennsylvania, and joined by California, Colorado, the District of Columbia, Delaware, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New Mexico, New Jersey, Oregon, Rhode Island, Vermont, Virginia, and Washington.  

This case is being handled by Deputy Bureau Chief Julie R. Ulmet, Civil Enforcement Section Chief Ming-Qi Chu, General Labor Section Chief Seth Kupferberg, and Assistant Attorneys General Jessica Agarwal and Michael O’Keefe Cowles, all of the Labor Bureau, and Assistant Attorney General Fiona Kaye of the Division of Federal Initiatives, under the supervision of Chief Counsel for Federal Initiatives Matthew Colangelo.