Yesterday, the National Labor Relations Board (NLRB) released
the final version of its new joint employer rule, which limits the
circumstances in which franchisors and businesses that use
employees hired by third parties can be required to bargain with
employees of those third parties and held jointly liable for
violations of federal labor law. The new rule – the result of
a larger effort by the Trump administration to limit joint employer
liability under federal employment law – rolls back a more
expansive Obama-era standard established by the NLRB in 2015.
Under the new rule, which takes effect on April 27, 2020, a
business is only considered a joint employer of another
entity’s employees if it has “substantial direct and
immediate control” over the most significant elements of a
worker’s job, including discipline, hiring or firing. This is
a meaningful retraction from the Obama-era standard, which made it
possible for a business to be deemed a joint employer if
