National Labor Relations Board Issues Final Joint Employer Rule: Addressing Indirect Control and Union Relations

On October 26, the National Labor Relations Board (NLRB) published its long-awaited final joint employer rule after initially publishing the revised rule for public comment in September 2022. This article delves into the key details of the new rule, its implications for employers, and the expected impact on the business landscape.

Explanation of the New Rule

The new rule replaces the regulations issued by the NLRB in 2020. Unlike the previous regulations, the revised rule considers evidence not only of direct control exercised by employers but also indirect control that is reserved by an employer. This shift expands the scope of what qualifies as a joint employer relationship, potentially affecting businesses in various industries.

Implications for Employers

Under this employee- and union-friendly rule, a company now risks being classified as the employer of workers over whom it does not exercise direct control but could theoretically and contractually. Consequently, if these employees unionize, the company may be obligated to engage in collective bargaining. Additionally, a joint employer could face liability for unfair labor practices committed by another business entity.

Historical Shifts in the NLRB’s View

Over the years, the NLRB’s interpretation of joint employer relationships has evolved, with the focus centering around the type and level of control exerted by an employer over another company’s workforce. The new rule draws inspiration from the Board’s Obama-era “Browning Ferris” rule, reversing prior changes and returning to a broader definition of joint employment.

Key Features of the Rule

The revised rule includes an exhaustive list of seven categories of workplace terms and conditions of employment that trigger the joint employer rule. These categories make the employer a party that exercises or has the potential to exercise control over areas such as wages, benefits, hours of work, hiring, and more. The rule places significant emphasis on indirect control and the mere right to control, rather than actual exercise of control.

Expected Impact on Employers

Given that indirect control and the contractual right to control significant working conditions are sufficient for the NLRB to establish a joint employer relationship, the new rule is expected to have wide-ranging implications for employers. Businesses that engage in staffing agreements or other arrangements where one party has rights to assert over the employees of the other party should immediately seek legal review of their agreements to ensure compliance with the revised rule.

Addressing Union Organizing and Employee Relations

In recent times, union organizing has reached historic highs, and NLRB developments have made it easier for unions to be certified without the necessity of winning an election. In light of these shifts, it becomes crucial for employers to work closely with experienced labor counsel to enact proactive employee relations measures. By ensuring employees are satisfied with their working conditions and environment, businesses can minimize the likelihood of their workforce seeking union representation.

The National Labor Relations Board’s final joint employer rule introduces significant changes to the framework governing joint employment relationships. By expanding the definition of joint employers to include those with indirect control and contractual potential, the rule places heightened obligations on businesses and raises potential liability concerns. Companies should prioritize reviewing their agreements and implementing proactive employee relations strategies to navigate these developments successfully and safeguard their operations. With a comprehensive understanding of the new joint employer rule, employers can adapt their practices to maintain compliance and foster positive labor relations in evolving times.

Explore more

SAP Updates Cloud ERP to Advance the Autonomous Enterprise

The transition to an autonomous enterprise is an incremental achievement built upon the convergence of trusted data, specific process contexts, and established business rules. The deployment of SAP Cloud ERP Private 2025 Feature Pack Stack 02 represents a definitive pivot toward a reality where business logic and artificial intelligence operate as a unified entity. Organizations no longer view AI as

Celo Launches Marketplace for Autonomous AI Agent Commerce

By utilizing decentralized physical infrastructure networks, the platform ensures that service delivery meets the data-intensive demands of modern artificial intelligence. The digital landscape is currently witnessing a transformative shift where software is no longer just a tool but an active participant in the global economy. Celo has stepped into this breach by launching its specialized marketplace, known as “buy,” which

How Low Will Bitcoin and Ethereum Go After the Crash?

The shift in market sentiment follows a rapid descent in which Bitcoin shed fifteen hundred dollars in value within minutes of a key economic announcement. This precipitous drop has rattled the confidence of retail participants who had grown accustomed to the relatively stable upward trend characterizing the first half of the year. While the digital asset class is no stranger

Google Gemini Evolves From Chatbot to Proactive Assistant

By integrating with the broader Google software suite, Gemini can now function as a logistical coordinator that audits schedules and calculates travel times. This shift from a traditional conversational interface to an autonomous agent marks a turning point in personal computing history. No longer is the system merely waiting for a prompt; it actively monitors the digital landscape to provide

How Did a Fake Chrome App Bypass Google Play Security?

The package name com.android.chrome serves as the primary technical differentiator between the official browser and the fraudulent Hizbartech version found on the storefront. The incident involving Hizbartech has exposed a glaring vulnerability in the way mobile applications are vetted and presented to the public, especially when high-trust brands like Google Chrome are targeted. For several weeks, unsuspecting users downloaded a