Martinez-Lopez v. GFA Alabama Inc.: Georgia District Court Broadly Identifies Multiple Joint Employer Standards

August 28, 2025 | United States District Court for the Northern District of Georgia | For Later Publication

(This article focuses only on the joint employer aspects of the court’s ruling and does not address the wide range of other claims resolved in the decision.)

Executive Summary

Judge J.P. Boulee of the Northern District of Georgia issued a lengthy order addressing motions to dismiss filed by GFA Alabama Inc. (“GFA”) and Glovis Georgia, LLC (“Glovis”). The plaintiffs, two Mexican nationals employed on TN visas, alleged that they were fraudulently recruited for engineering roles but were instead assigned manual labor in warehouses. The court dismissed some claims but allowed others to proceed, with particular emphasis on whether Glovis could be held liable as a joint employer with GFA. In doing so, the court laid out multiple joint employer standards—under Title VII, § 1981, the ADA, and the FLSA—and applied them in a manner favorable to plaintiffs at the pleading stage.

Relevant Background

The plaintiffs, both citizens of Mexico, entered the United States on TN visas, which authorize professional work such as engineering. They alleged that GFA Alabama Inc. (“GFA”), a labor recruiter and logistics company, misrepresented the nature of their positions by promising professional engineering jobs but assigning them to warehouse labor once they arrived in Georgia. According to the complaint, GFA required them to perform manual tasks such as packaging, loading, and moving heavy boxes, while denying them the engineering duties described in their offer letters.

The plaintiffs further alleged that GFA imposed unfavorable working conditions on TN visa workers compared to American and non-Latino employees. GFA supervisors allegedly segregated night shifts by assigning them only to Mexican and Latino workers, required those workers to perform cleaning tasks while excusing others, and deducted undisclosed amounts from paychecks for company-arranged housing and transportation. Plaintiffs claimed GFA paid them less than similarly situated American or non-Latino coworkers and assigned excessive overtime without proper overtime pay.

Beyond pay and scheduling, plaintiffs also accused GFA supervisors of making derogatory remarks. They alleged that GFA managers mocked their English, prohibited them from speaking Spanish, and told them they should “go back to Mexico” if they did not like the conditions. One plaintiff further alleged that after she disclosed a pregnancy, GFA refused to accommodate her requests for light duty, scrutinized her work more closely, issued disciplinary write-ups, and ultimately terminated her.

With respect to Glovis Georgia, LLC (“Glovis”), the plaintiffs did not allege direct harassment but claimed that Glovis exercised control over their day-to-day work. Specifically, they alleged that Glovis:

• Owned and controlled the West Point warehouse where they worked;
• Controlled the equipment and commodities necessary for their assignments;
• Set quality control standards that governed their work;
• Determined work hours and assignments, including through a Glovis digital application, “Just In Sequence,” that provided daily schedules and monitored performance minute-by-minute;
• Sent supervisors into the warehouse to observe operations and review employees’ assignments with GFA managers;
• Distributed a Glovis-branded work calendar to TN visa employees showing pay dates, workdays, holidays, and production schedules; and
• Received “all worker information” from GFA and made final decisions about whether workers stayed or were terminated.

These allegations placed Glovis at the center of the plaintiffs’ theory that both companies jointly controlled the terms and conditions of their employment.

Decision

The court analyzed joint employer liability under several statutes, applying different standards depending on the claim:

• Title VII, § 1981, and ADA: The Eleventh Circuit applies a control-based test that looks to whether two entities “share or co-determine those matters governing the essential terms and conditions of employment.” Peppers v. Cobb County, 835 F.3d 1289, 1300 (11th Cir. 2016) (quoting Virgo v. Riviera Beach Assocs., 30 F.3d 1350, 1360 (11th Cir. 1994)). The “focal point of the inquiry” is not which entity controlled the specific aspect of the relationship giving rise to the discrimination claim, but “which entity or entities controlled the fundamental and essential aspects of the employment relationship when taken as a whole.” Id. at 1301. Judge Boulee acknowledged that GFA exercised extensive day-to-day control, but also pointed to allegations that Glovis owned the warehouse, set hours and assignments through its digital application, monitored performance through both software and in-person supervisors, and allegedly had authority over retention decisions. The court concluded: “though it is a close question, these alleged facts plausibly show that both Glovis and GFA retained at least some control over the fundamental and essential aspects” of employment. The court stressed, however, that this finding was limited to the pleading stage: “This is not to say … that the determination of whether Glovis qualifies as an employer cannot be presented at the summary judgment stage after the parties have had an opportunity to uncover facts through discovery.”
• FLSA: The Fair Labor Standards Act defines “employ” to mean “to suffer or permit to work,” 29 U.S.C. § 203(g), a formulation the Eleventh Circuit has described as having “striking breadth” and as one of “the broadest possible delineations of the employer–employee relationship.” Garcia-Celestino v. Ruiz Harvesting, Inc., 843 F.3d 1276, 1287 (11th Cir. 2016). To operationalize that standard, courts apply an “economic reality” test and consider eight non-exclusive factors: (1) the nature and degree of control of the workers; (2) the degree of supervision, direct or indirect, of the work; (3) the power to determine pay rates or methods of payment; (4) the right, directly or indirectly, to hire, fire, or modify employment conditions; (5) preparation of payroll and payment of wages; (6) ownership of the facilities where work occurs; (7) whether the work performed is an integral part of the alleged employer’s business; and (8) the alleged employer’s investment in equipment and facilities. Layton v. DHL Exp. (USA), Inc., 686 F.3d 1172, 1175 (11th Cir. 2012). Applying these factors, the court highlighted allegations that Glovis owned the facility, set schedules through its digital application, monitored performance both digitally and in person, and had input into decisions about retention. It concluded that “these allegations plausibly suggest, at least at this early stage of the proceedings, that Soriano was economically dependent on Glovis,” but cautioned that “whether that will bear out after discovery remains to be seen”.

In short, while GFA remained the direct employer, the court refused to dismiss Glovis, holding that plaintiffs had plausibly alleged joint employer status under both the discrimination statutes and the FLSA.

Looking Forward

This case illustrates the difficulty employers face when navigating joint employer issues in litigation. The standards the court applied may be viewed as relatively lenient at the pleading stage, where plaintiffs need only allege facts suggesting that a second entity had some control or influence over the terms and conditions of employment. At this point in the case, that was enough to keep Glovis in as a defendant, but another court might have viewed the allegations differently.

The decision also highlights how joint employer tests may vary depending on the statute at issue. Title VII, § 1981, and ADA claims focus on control of “fundamental and essential aspects” of employment, while FLSA claims apply the broader “suffer or permit to work” standard. That statutory definition is the heart of the FLSA joint employer test, and courts then use the eight economic reality factors to give it shape. Even within the same circuit, the standards may diverge, creating compliance challenges for employers.

Having worked on joint employment issues for more than a decade, I have seen firsthand how the standards continue to evolve and become more complex, making it increasingly challenging for employers to navigate with confidence. Some businesses have decided that if joint employment liability is going to be interpreted broadly, they are willing to accept that risk in exchange for the ability to strictly enforce brand standards and quality control—though doing so often requires additional staffing, with the cost passed on to the affiliated employer. At the other end of the spectrum, some employers are choosing to exit jurisdictions where they view the joint employer standards as unworkable. That choice may limit their own opportunities, but it can also deprive those jurisdictions of business investment and jobs. These tensions underscore why a unified and predictable joint employer standard remains so critical.

Thomas O’Connell is a Shareholder at Buchalter APC 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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