John Stewart
Thu, 11/02/2023
On October 26, 2023, the National Labor Relations Board (NLRB) issued a final rule updating the standard for determining when an entity is a joint employer that will have to come to the bargaining table under the National Labor Relations Act (NLRA).
The new rule makes it easier for private sector employees to demonstrate that a second company—like a staffing agency or franchisor—is also their employer for purposes of collective bargaining protections under the NLRA. Specifically, the new rule removes the requirement that employees show their alleged joint employer exercise “direct and immediate control” over their terms and conditions of employment. Instead, a company may be a joint employer if it retains the “authority to control essential terms and conditions of employment, whether or not such control is exercised, and without regard to whether any such exercise of control is direct or indirect, such as through an intermediary.” (emphasis added). Per the updated rule, moreover, two entities will be joint employers of employees for which they “share or co-determine” the essential terms and conditions of employment.
The NLRB emphasized that the new rule brings the test more in line with common-law definitions of employer and, perhaps more importantly from employees’ and unions’ perspective, the new rule will more fully promote the policies underlying the NLRA. As a result of the new rule, employees previously unable to effectively organize and bargain with their more immediate employers may find a new opportunity to bring larger organizations—such as staffing agencies, franchisors, or other entities retaining indirect control over their work—to the bargaining table.
If you have questions about your rights as an employee or union member, or you otherwise believe you have been denied any other protected rights or employment benefits, please reach out to MSE at info@mselaborlaw.com.
