On 22 April 2026, the US Department of Labor’s (DOL) Wage and Hour Division announced a proposed rule (Proposed Rule) addressing joint employer status under the Fair Labor Standards Act of 1938 (FLSA), the Family and Medical Leave Act of 1993, and the Migrant and Seasonal Agricultural Worker Protection Act of 1983 (collectively, the Applicable Statutes). The DOL’s Proposed Rule is intended to establish a single nationwide standard for determining when multiple entities may be jointly responsible for wages, damages, and other statutory obligations to employees under the Applicable Statutes.
This Proposed Rule is significant for businesses that operate through franchise systems, staffing agencies, contractor relationships, and other business models involving shared oversight or control of workers because these work arrangements often involve the highest risk of being classified as joint employers who share the legal obligations owed to workers.
The Proposed Rule follows the rescission of President Donald Trump administration’s 2020 joint employer rule (2020 Rule) by the US District Court for the Southern District of New York. Following recission, and in the absence of a final rule, businesses encountered various tests for joint employer status that varied greatly across jurisdictions. Thus, the Proposed Rule serves as the DOL’s first attempt to establish a workable joint employer framework since July 2021. As background, the 2020 Rule required actual...
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