A federal trial court has vacated the controversial new National Labor Relations Board (NLRB) joint employer rule and restored the 2020 version of the rule that made it harder to find that an entity is a joint employer. If the new rule had taken effect as scheduled March 11, 2024, it would have been much easier to find that two entities are joint employers and thus jointly liable for alleged employment law violations.
The U.S. District Court for the Eastern District of Texas ruled in Chamber of Commerce of the U.S.A. v. National Labor Relations Board that the regulation issued last year was overly broad. The court held that the Board’s interpretation was arbitrary and capricious because it failed to establish a definite standard that will reduce uncertainty.
Members of the Center for Workplace Compliance (CWC), our affiliated nonprofit membership association, can read more here.