December 12, 2025|Franchise Frontlines
December 12, 2025 | Supreme Court of North Carolina | Published Opinion
Executive Summary
In a published decision, Justice Barringer of the Supreme Court of North Carolina clarified the state’s joint employment doctrine while reversing a Court of Appeals decision that had found a construction contractor jointly liable for workers’ compensation benefits owed to an injured off-duty police officer. The officer had been directing traffic for a highway construction project when he was struck by a vehicle and sought workers’ compensation benefits from both the sheriff’s office that employed him and the contractor performing the road work. The contractor argued that the officer remained solely an employee of the sheriff’s office because the sheriff’s office controlled the officers’ work assignments and supervision. The Court agreed, holding that although an implied contract for hire existed between the officer and the contractor and the officer’s work furthered both entities’ interests, the contractor did not exercise the simultaneous control required to establish joint employment. In doing so, the Court clarified the distinction between the joint employment and lent employee doctrines and disapproved prior appellate precedent that had conflated the two tests.
Relevant Background
Stephen Matthew Lassiter worked as a law enforcement officer for the Robeson County Sheriff’s Office (“RCSO”). Like many officers, he supplemented his income through approved off-duty employment assignments. Under RCSO policy, officers were permitted to accept outside work only with supervisory approval, and the sheriff’s office coordinated these assignments when contractors requested law enforcement assistance.
In 2017 the North Carolina Department of Transportation awarded Truesdell Corporation a contract to perform bridge repair work along Interstate 95. Because the project required lane closures and detours, the contract required Truesdell to implement a traffic control plan and utilize uniformed law enforcement officers to direct traffic during nighttime construction work. The contractor worked with RCSO supervisors to secure officers for these assignments, and officers were paid directly by the contractor for their off-duty work.
Under the arrangement, Truesdell communicated its need for officers to RCSO supervisors, who selected the officers assigned to each shift. The supervisors also determined the officers’ work schedules and positions along the traffic route. Officers met before each shift to review the approved traffic control plan and were then assigned their positions by RCSO personnel. While directing traffic, officers exercised their own law enforcement judgment regarding how to manage traffic flow.
On March 28, 2019, Lassiter accepted an off-duty assignment directing traffic for the project. During his shift he was repositioned along the traffic route by a sheriff’s office supervisor. While directing vehicles with his patrol car’s emergency lights activated, he was struck by a vehicle and seriously injured.
Lassiter filed a workers’ compensation claim naming both RCSO and Truesdell as employers. The North Carolina Industrial Commission concluded that Lassiter was employed only by the sheriff’s office. The Court of Appeals reversed in part, holding that Truesdell also qualified as a joint employer. The North Carolina Supreme Court granted discretionary review to determine whether the contractor exercised sufficient control to create a joint employment relationship.
Decision
The Supreme Court began by clarifying the legal framework governing joint employment and the related lent employee doctrine. The Court explained that both doctrines address situations in which more than one entity may qualify as an employer, but they arise in different circumstances. Under the joint employment doctrine, an employee simultaneously performs services for two employers under the concurrent control of both. By contrast, the lent employee doctrine applies when an employee is temporarily loaned to another employer whose work the employee performs.
The Court emphasized that although both doctrines require a contract of hire with the alleged employer, the remaining elements differ. In particular, the Court clarified that the “nature of the work” requirement is distinct for each doctrine. Joint employment requires only that the work performed for each employer be the same as, or closely related to, the work performed for the other. The lent employee doctrine requires that the work be essentially that of the borrowing employer. The Court expressly disapproved prior Court of Appeals precedent that had merged the two tests.
Applying the clarified framework, the Court first concluded that an implied contract for hire existed between Lassiter and the contractor. Lassiter knew he was performing traffic control work for the contractor and expected to be paid directly for that work. The contractor likewise knew that off-duty officers would implement its traffic control plan and paid Lassiter for his services. Those circumstances supported the existence of an implied employment agreement.
The Court also determined that the “nature of the work” element was satisfied. Lassiter’s traffic control duties served both his role as a law enforcement officer responsible for public safety and the contractor’s need to manage traffic during construction. Thus, the services performed were closely related to the interests of both entities.
The dispositive issue was whether Lassiter worked under the simultaneous control of both employers. The Court concluded that he did not. Although the contractor developed the traffic control plan and determined where traffic control was required, the sheriff’s office controlled the key aspects of the officers’ work. RCSO supervisors selected which officers would work each shift, assigned them to particular locations, set their schedules, and retained authority to remove officers from the job site. The contractor could not independently hire, fire, or reassign officers and had to communicate through the sheriff’s office if it had concerns about an officer’s performance.
The Court further observed that officers exercised independent judgment in carrying out their traffic control duties. Officers determined how to manage traffic flow and remained responsible for responding to law enforcement matters that arose during their shifts. The contractor did not supervise the officers’ day-to-day actions and had no personnel on site directing their work.
Because the contractor lacked the right to control the details of the officers’ work, the Court held that the simultaneous control requirement of the joint employment doctrine was not satisfied. Accordingly, Lassiter remained solely an employee of the sheriff’s office for workers’ compensation purposes.
Looking Forward
The decision provides important clarification regarding the distinction between joint employment and the lent employee doctrine under North Carolina law. By emphasizing the differences between these doctrines and expressly disapproving precedent that had blurred the tests, the Court reinforced that joint employment requires more than a shared economic interest in a worker’s activities. The Court’s analysis underscores that the decisive question remains whether the alleged employer possesses the right to control the manner and details of the worker’s performance.
The opinion also illustrates how courts evaluate multi-entity operational relationships in determining employment status. Even where one entity designs the operational framework of a project, establishes safety requirements, and pays workers for certain services, those factors alone may not establish an employment relationship. Instead, courts focus on who selects workers, assigns their duties, supervises their activities, and retains authority over hiring and discipline.
For franchisors and other brand-based systems, the case illustrates the types of theories plaintiffs increasingly attempt to advance in litigation involving multi-entity business structures. Plaintiffs frequently rely on agency concepts, integrated-enterprise allegations, and joint-employment frameworks to attribute the conduct of intermediaries to multiple companies within a corporate structure. At the same time, the Court’s analysis reinforces that the existence of contractual requirements, operational coordination, or economic benefit does not necessarily establish employment control absent authority over the details of the worker’s performance. The opinion therefore serves as a useful reminder that courts continue to scrutinize the element of control carefully when determining whether a second entity may be treated as an employer.
This article is based solely on the opinion of the Court in this matter. The author has not conducted any independent investigation into the facts. For the avoidance of doubt, each statement related to the law and facts in this article is drawn from the Court’s opinion in this case.
Thomas O’Connell is a Shareholder at Buchalter LLP and Chair of the firm’s Franchise Practice Group. For questions about this article or media inquiries, you can contact Tom at toconnell@buchalter.com.
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