The National Labor Relations Board officially restored a business-friendly joint-employer rule on February 26 in the latest chapter of a saga that has spanned the last decade. The new final rule makes it more difficult for businesses to be held legally responsible for alleged labor law violations by staffing companies, franchisees, and other related organizations. A Texas federal court judge had struck down a Biden-era rule in March 2024 that would have made it far easier for workers to be considered employees of more than one entity – and the Board dropped its appeal a few months later. While the 2020 rule from President Trump’s first term was already effectively back in place due to the court ruling, the NLRB’s latest move formally reverts back to it. While we expect legal challenges to the new rule, the latest move is good news for businesses. How did we get here and what can you expect next?

Back and Forth and Back Again

You might feel a bit of whiplash given the changes that have occurred in this area, especially over the last decade. Here’s a quick recap on how we got here:

• For over 30 years, the NLRB had held that two companies would only be considered “joint employers” – equally responsible for certain labor and employment matters – if they shared or co-determined matters governing the essential terms and conditions of employment, and actually exercised the right to control.
• In 2015, the Board renounced this decades-old test in the controversial Browning-Ferris...

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