Updates on NLRB Joint Employer Rule

An independent contractor and joint employer have technically different issues, but they have a lot of overlap.  The independent contractor standard deals with whether a worker is an employee or independent contractor, while the joint employer standard deals with whether the companies share legal responsibility for the same group of workers.  Both standards are in the current news.  On February 26, 2026, the National Labor Relations Board (NLRB) formally reinstated its 2020 joint employer standard.

Just like the history under the independent contractor rule changes, the joint employer standard has changed from 2020, where the Trump-era standard found joint employment only when two companies exercised direct and substantial control over the same worker.  In 2023, during the Biden era, the NLRB expanded joint employment finding it applied even when based only on “indirect” or “reserved” control.  That rule was struck down by a Texas district court ruling, and the Biden-era rule was vacated, but the official regulations had not bee updated to reflect the return of the previous rule.

The most immediate effect of the formal reinstatement of the 2020 joint employer rule is that a company is deemed to be a joint employer only if it exercises “substantial direct and immediate control” over the essential terms and conditions of another company’s employees.  Merely retaining the ability to influence the decisions of another company’s decisions dealing with its employees, without actually doing so, is generally insufficient to create a joint employment relationship.  Similarly, indirect influence on general operational expectations are not enough to trigger joint employment status. 

Editor’s Note:  It should be noted that there is a fine line between “directing the work” of another entity’s workers which is to be avoided, while an entity may set basic standards for a project without crossing the line to joint employment.

This article is part of our April 2026 Newsletter. 

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