Maryland Employment Attorneys – Luchansky Law

The New NLRB Ruling on Joint Employers for 2024

The National Labor Relations Board (NLRB) recently finalized a significant rule change regarding the Standard for Determining Joint-Employer Status. Effective December 26, 2023, the new NLRB rule represents a seismic departure from previous standards, promising far-reaching implications for labor relations and legal obligations. 

But what does this rule actually entail, and why should it matter to you? Let’s unravel the intricacies of this transformative shift and explore its profound significance in shaping the landscape of employment dynamics.

What is the new NLRB rule?

The new NLRB rule clarifies when multiple entities can be considered joint employers of a group of employees under the National Labor Relations Act (NLRA). According to the new standard, if two or more entities have an employment relationship with the same group of employees and they share or have a say in determining one or more essential terms and conditions of employment for those employees, they can be considered joint employers.

The new joint employer test  

Under the new rule, two or more entities are joint employers when they “share or codetermine one or more of the employees’ essential terms and conditions of employment (see link below).” An ‘entity’ in this context refers to any organization, such as a corporation, partnership, or individual, involved in employment arrangements. The NLRB can say two entities are joint employers if one of them controls or has the power to control necessary job conditions of the other’s employees, even if it doesn’t actually use that power.


The types of essential job conditions covered by the rule are broad:

1. Wages, benefits, and other compensation 

2. Hours of work and scheduling 

3. The assignment of the performance of duties 

4. The supervision of the performance of duties 

5. Work rules and directions governing the manner, means, and methods of the performance of duties and the grounds for discipline 

6. The tenure of employment, including hiring and discharge 

7. Working conditions related to the safety and health of employees

An entity can be a joint employer if it has the power to control any of these seven things, even if it doesn’t actually do it. As long as a company has the authority to step in and control one of these important terms, it’s considered a joint employer.

What was the NLRB rule before?

Before the NLRB’s recent change, a 2020 standard had established a higher threshold for determining joint-employer status. Under this rule, businesses needed a significant level of direct and immediate control over employees’ work conditions to be classified as joint employers. This allowed businesses to distance themselves from certain liabilities, like labor disputes or wage violations, by demonstrating a lack of direct control. 

Under the 2020 standard, businesses could avoid joint-employer classification if they lacked substantial, direct control over essential employment terms. However, the December 2023 rule expands this scope, including factors beyond direct control. Even if a business doesn’t directly oversee aspects like wages or work schedules, it could still be deemed a joint employer if it has the authority or ability to influence these factors. This adjustment may increase businesses’ accountability for employment-related issues, even when third-party entities like contractors or staffing agencies are involved. 

Why did the rule change?

The NLRB adopted the new rule to align more closely with established common-law agency principles, departing from the 2020 standard. The previous rule set a higher threshold for determining joint-employer status, which the NLRB found lacked a foundation in common law. By rescinding the 2020 standard and implementing the new one, the NLRB aims to provide more precise guidance to parties involved in joint-employer situations and ensure a more accurate reflection of traditional legal principles. 

What does the new NLRB ruling mean for business owners?

From a business owner’s perspective, this rule change necessitates a more comprehensive review of their relationships with other entities involved in employment arrangements. They may need to reassess contracts, policies, and practices to ensure compliance with the updated standard. Additionally, it could lead to increased scrutiny and potential legal exposure regarding employment practices, requiring proactive measures to mitigate risks and maintain compliance with labor laws. 

Does the NLRB ruling apply to independent subcontractors?

Yes, the new NLRB ruling extends to independent subcontractors, establishing that if entities share or influence essential employment terms, they can be deemed joint employers. This broadens the scope of joint employment under the NLRA, affecting employers, particularly those utilizing staffing agencies or subcontractors. Consequently, subcontractors may be deemed joint employers if they influence vital employment conditions for workers, even indirectly through intermediaries.

What does this mean for subcontractors?

This rule change holds significant implications for subcontractors. It makes it easier to protect workers’ rights and ensure they’re treated fairly by all the companies involved. Subcontractors, along with the other entities involved, now have a clearer understanding of their responsibilities towards jointly employed workers. 

By requiring joint employers to negotiate and discuss important work-related matters together, the rule promotes transparency and accountability in labor relations. It fosters a fair and responsible environment for all parties involved, ultimately benefiting workers and businesses alike.

How can employers and subcontractors ensure compliance with the new NLRB joint employer rule?

To ensure compliance with the new NLRB joint employer rule, subcontractors and employers should consider the following measures based on the information available: 

Review contracts and practices: 

Subcontractors should review their contracts and practices to ensure they align with the new joint employer rule. This includes assessing the level of control over essential terms and conditions of employment, such as wages, benefits, and working conditions, to determine potential joint-employment status. 

It is advisable for subcontractors to seek legal counsel to analyze service contracts and other documents to identify any potential areas of concern regarding the new joint employer rule.

Understand collective bargaining obligations:

The new rule requires joint employers to participate in the collective bargaining process. Subcontractors should be aware of their potential obligations in this regard. 

Stay informed:

Given the potential impact of the new rule, subcontractors should stay informed about further developments and guidance related to joint employer status under the NLRA. 

By taking these steps, subcontractors can work towards ensuring compliance with the new NLRB joint employer rule and mitigating the potential implications of the expanded joint-employer standard.

Are you concerned about the New NLRB Rule? We can help!

The new NLRB rule on joint employer status represents a significant shift in labor relations, with far-reaching implications for businesses, subcontractors, and workers alike. By clarifying the criteria for joint employment under the NLRA, the rule aims to promote transparency, accountability, and fairness in employment arrangements. 

Business owners and subcontractors must proactively assess their relationships and practices to ensure compliance with the updated standard. 

By adhering to the new NLRB rule, stakeholders can ultimately foster a more equitable and responsible work environment, benefiting both employees and businesses in the long run. 

As you adapt to these changes, it’s essential to ensure compliance and fairness in your workplace. At Luchansky Law, we’re here to support you every step of the way. Whether you need clarification on the new NLRB rule or assistance in staying compliant, our team is ready to help. Reach out to us today to learn how we can assist you in creating a fair and accountable work environment. You can reach us at (410) 522-1020, email us at or stop by our office at 606 Bosley Avenue, Suite 3B, Towson, Maryland 21204.

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