The National Labor Relations Board introduced its regulatory proposal to ease the legal standard for determining when one company jointly employs another firm’s workers, a major step toward undoing the employer-friendly rule the board minted during the Trump administration.
The proposed rule released Tuesday would expand the factors that can establish a joint employment relationship to include indirect and unexercised control over the terms and conditions of a job. Employers would be considered joint employers if they co-determine “essential terms and conditions of employment,” such as scheduling, wages, and benefits. It would rescind the Trump-era joint employer rule that took effect in April 2020.
Joint-employer companies share liability for unfair labor practices and responsibility for bargaining with a union—making the NLRB’s legal test for joint employment one of the most bitterly contested issues in federal labor law over the past decade.
“In an economy where employment relationships are increasingly complex, the Board must ensure that its legal rules for deciding which employers should engage in collective bargaining serve the goals of the National Labor Relations Act,” NLRB Chair Lauren McFerran said in a statement.
The potential for extending labor law obligations across companies is a major...
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