Meet the 4th Circuit Court of Appeals. In Butler v. Drive Automotive Industries (opinion here), the Court held that the manufacturer was a "joint employer." In other words, the manufacturer could not escape liability by claiming Brenda was the staffing agency's employee and not theirs.
How did the Court get there? Well, it applied a "hybrid" approach, which "combines aspects of the economic realities and control tests." For more on how much I love all of these different tests, see here. The 4th Circuit identified no fewer than eleven factors (effectively ensuring that no one will ever have any clue how these cases are going to come out before the Court
(1) the kind of occupation, with reference to whether the work usually is done under the direction of a supervisor or is done by a specialist without supervision;
(2) the skill required in the particular occupation;
(3) whether the “employer” or the individual in question furnishes the equipment used and the place of work;
(4) the length of time during which the individual has worked;
(5) the method of payment, whether by time or by the job;
(6) the manner in which the work relationship is terminated; i.e., by one or both parties, with or without notice and explanation;
(7) whether annual leave is afforded;
(8) whether the work is an integral part of the business of the “employer”;
(9) whether the worker accumulates retirement benefits;
(10) whether the “employer” pays social security taxes; and
(11) the intention of the parties.The "control" factor carries more weight than the others. I don't usually use my blog for advocacy, but there has got to be a better way to define "employees" and "employers." This issue could be resolved by either a Supreme Court opinion or new legislation (even then you have a potential fed-state split).