On February 26, 2026, the National Labor Relations Board (the “NLRB” or “Board”) issued a final rule formally restoring the Board’s February 2020 joint-employer regulation under the National Labor Relations Act (“NLRA”). The final rule replaces the text of the Board’s vacated November 2023 joint-employer rule with the 2020 rule’s narrower standard—one that generally requires a business to both possess and actually exercise “substantial direct and immediate” control over another entity’s employees’ essential terms and conditions of employment to be deemed a joint employer.
Although many employers have effectively been operating under the 2020 standard since a federal court vacated the 2023 rule before it took effect, the Board’s action removes the vacated 2023 regulation from the Code of Federal Regulations (“CFR”) and re-codifies the 2020 rule as the operative regulatory framework. The Board characterized the update as “ministerial” and stated that it creates no separate economic effect. In practical terms, the “change” is that the CFR now again reflects the 2020 rule text, not that the governing standard has newly shifted in practice as of February 26, 2026. The Board also invoked the “good cause” exception to publish the rule without advance notice-and-comment.
This development matters for businesses that operate through staffing arrangements, subcontracting, vendor/service models, and franchise relationships, where joint-employer allegations can expand bargaining...
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