NLRB Overrules Standard for Joint Employer Status: Board Reinstates Stricter Measure of Joint Liability

NLRB Overrules Standard for Joint Employer Status: Board Reinstates Stricter Measure of Joint Liability

The National Labor Relations Board (NLRB) has reversed its position on joint employer liability, returning to an earlier, narrower standard for assessing joint employer status. In all pending and future cases, two or more entities will be considered joint employers under the National Labor Relations Act (NLRA) if:

  • One entity has exercised control (not merely reserved the right to exercise control) over essential employment terms of another entity’s employees; and
  • The entity has exercised the above directly and immediately in a manner that is not limited and routine.

Under the reinstated standard, proof of the following will not be sufficient to establish a joint employer relationship under the NLRA:

  • Indirect control;
  • Contractually reserved control that has never been exercised; or
  • Limited and routine control.

To read the NLRB’s decision, click here.