The National Labor Relations Board (NLRB) announced it will extend the effective date of its joint employer rule to February 26, 2024, to facilitate the resolution of legal challenges to the rule. On November 9, 2023, various business groups sued the NLRB in federal district court, alleging the joint employer rule is unlawful. As we previously reported, the NLRB released the final rule on October 26, with an implementation date of December 26, 2023.
The new joint employer rule is significant because it broadens the scope of joint employment under the National Labor Relations Act (NLRA). Under the previous 2020 rule, employers were only considered joint employers if they exercised direct and immediate control over the worker’s essential terms and conditions of employment.
Next Steps
If allowed to stand, the new joint employer rule will be a significant development for employers. While employers may have additional time to comply, they should still carefully review the new rule to assess its impact on their operations and to take steps to comply with the new rule including but not limited to reevaluating relationships with staffing agencies, contractors, franchisees, and other businesses to determine whether they could be considered joint employers under the new rule and updating their employment policies and procedures to ensure that they comply with the new rule.
Employers should consult with an employment attorney to discuss the specific impact of the new joint employer rule on their operations and to develop strategies for compliance.
