On February 27, 2026, the National Labor Relations Board (NLRB) issued a final rule reinstating its 2020 joint-employer standard. Just prior, the NLRB had reaffirmed its 2015 Browning-Ferris joint-employer standard, but only in a limited fashion pursuant to a U.S. Court of Appeals for the D.C. Circuit decision. This latest twist highlights the uncertainty surrounding when an employer may be deemed a joint employer under the National Labor Relations Act (NLRA).
Let’s get right to it.
Background on Joint Employer Status and Browning-Ferris
A joint-employer relationship occurs when different entities exercise a certain degree of control over an employee to the point where each has formed an employment relationship with the individual. This is important, because when an employment relationship is formed, it creates certain rights and obligations between the employer(s) and the employee under different laws.
Relevant laws include the Fair Labor Standards Act, Title VII of the Civil Rights Act, and the NLRA.
In 2015, the NLRB’s decision in Browning-Ferris considered whether a California recycling facility, Browning-Ferris Industries, jointly employed sorters, screeners, and housekeepers who had been provided by Leadpoint Business Services (Leadpoint). The Board’s 2015 decision expanded joint-employment status to include employers that (1) indirectly affect employees’ terms and conditions of employment or (2) reserve the right to control but don’t, in fact, exercise that right. The consequence of this decision was that many more employers met the NLRB’s joint employer test. However, following the 2020 Administration change and developments in the NLRB, the NLRB reinstated the stricter pre-Browning-Ferris requirement of direct and immediate control. Dissatisfied with the NLRB’s revised position, the D.C. Circuit Court remanded the Browning-Ferris matter back to the NLRB for further clarification on which standard was being applied.
Meanwhile, in 2023, the NLRB published another final rule that rescinded the 2020 rulemaking and codified the Browning-Ferris framework. However, before this rule could take effect, a federal court in Texas vacated the rule, and the NLRB announced it would not appeal the decision.
Where the Joint Employment Standard Currently Stands
As of this writing, the NLRB’S rule published and effective on February 27, 2026 is controlling, reinstating the pre-Browning-Ferris framework and a higher threshold for determining joint-employer status.
Under this reinstated rule, a business must possess and exercise substantial direct and immediate control over at least one essential term and condition of employment of another employer’s employees in order to be a joint employer. The rule defines substantial direct control as actions that have a “regular or continuous consequential effect” on one of the eight core aspects of a worker’s job. These essential terms and conditions of employment are:
- Wages;
- Benefits;
- Hours of work;
- Hiring;
- Discharge;
- Discipline;
- Supervision; and
- Direction.
Notably, the rule provides that even where an employer exercises direct control over another employer’s workers, it will not be considered substantial (and therefore won’t result in a joint employer situation) if the control is exercised in a sporadic, isolated, or de minimis basis.
One caveat to this final rule is the NLRB’s decision that came just prior, on February 23, 2026. There, the NLRB reaffirmed its lower threshold for joint employment and determined Browning-Ferris industries was indeed a joint employer with Leadpoint. However, the NLRB emphasized that this holding is limited to the Browning-Ferris case and doesn’t override its current joint-employer test.
Implications and Takeaways Regarding Joint Employment
For employers and HR professionals, there should be two primary takeaways from the NLRB’s recent decision. First, in litigation and bargaining contexts referencing Browning-Ferris itself, the broader standard involving indirect and reserved control still may apply. The NLRB explicitly described its reaffirmation as “law of the case,” meaning that earlier fact patterns and remands compel its use in this narrow context.
Second, for general compliance and future cases, employers should utilize the tighter threshold found in the NLRB’s most recent final rule. To reiterate, this rule follows the 2020 joint-employer rule and provides that an employer is a joint employer when it exercises direct and immediate substantial control over essential terms and conditions of employment.
As you may have gathered from the legal back and forth, the joint employer standard has been one of the most contentious labor issues in the past decade. This underscores the importance of carefully structuring workforces, especially when staffing agencies, subcontractors, franchise relationships, or outsourced labor is involved.
Because of the ever-changing legal landscape in employment law, The Coppola Firm is here to keep you up to date on what you need to know. As always, we’ll follow this issue closely and will be alert to any changes in statutes or regulations, caselaw or rulings by federal or New York State government actors.
If you have any questions about your company’s practices or other aspects of employment law, feel free to contact us at 716.839.9700 or info@coppolalegal.com.
