On October 26, 2023, the National Labor Relations Board (“NLRB” or “the Board”) unveiled a final rule, which redefines the standards for joint-employer status under the National Labor Relations Act (“NLRA” or “the Act”). The decision was made with a voting ratio of 3:1, with all three Democratic members of the Board endorsing the rule.
According to JD Supra, the new rule considerably broadens the definition of joint employment under the NLRA, which will have significant implications for many businesses and law firms. In particular, this will impact those that work with subcontractors, franchisees, or others in relationships that could potentially fall under the scope of the joint-employer rule.
It’s important for legal professionals to understand the nuances of the NLRB rules and how they will impact their practice or the organizations they serve. Every organization that may be affected by the expanded definition will need to assess their relationships with subcontractors, franchisees, and other entities to ascertain exposure to joint employer status.
This rule is part of a significant regulatory shift under the current administration, reflecting a more expansive interpretation of employer obligations and employee rights under the NLRA. It highlights not only the active role of the NLRB in shaping and enforcing labor relations policies but also the ever-changing landscape of employment law. This underlines the need for legal professionals to stay abreast of current developments to ensure ongoing compliance.