The National Labor Relations Board (“NLRB” or “the Board”) has proposed a new rule for determining joint employer status under the National Labor Relations Act (“NLRA”). The proposed rule comes after nearly a decade of the Board changing positions as to what could render two independent companies joint employers. Most changes have involved the degree to which one employer must retain the right to control another company’s employees’ terms and conditions of employment to make them joint employers. Courts have also gotten involved, especially the District of Columbia Federal Court of Appeals. Federal administrative agencies, such as the Department of Labor and the EEOC have also tended to follow the NLRB’s twists and turns on the issue.
In a statement issued September 6, 2022, Board Chair Lauren McFerran explained the Board majority’s goal to implement “a clear standard for defining joint employment that is consistent with controlling law” after years of “uncertainty and litigation.” While the proposed rule is not yet final and is subject to public comment, it is likely to impact labor relations and business relationships of many business relationships.
For at least 30 years prior to 2015, the Board’s standard for determining whether a joint employer relationship existed was based on whether “two separate entities share or codetermine those matters governing the essential terms and conditions of employment.” To be considered a joint employer, an employer had to “...
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