As part of a legal challenge against the National Labor Relations Board’s joint employer final rule, a federal judge in Texas delayed the final rule’s effective date from Feb. 26 to March 11. The new standard will only be applied to cases filed after the rule becomes effective.

On Nov. 9, 2023, ABC joined the U.S. Chamber of Commerce and a coalition of business groups in filing a lawsuit challenging the NLRB’s final rule for violating the National Labor Relations Act and for acting arbitrarily and capriciously in violation of the Administrative Procedure Act. The final rule takes an ax to the ABC-supported 2020 NLRB joint employer final rule, which provided clear criteria for companies to apply when determining status.

The NLRB’s joint employer final rule will disrupt long-established, efficient operational processes that are followed by construction service providers that work together to build America. As a result of the confusion and policy whiplash caused by this overbroad standard, contractors will be vulnerable to increased liability and risk, making them less likely to hire subcontractors, most of which are small businesses. Read ABC’s press release about the final rule.

On Dec. 7, 2022, ABC submitted comments to the NLRB, urging the Board to withdraw the proposed rule.

Resources:

• ABC General Counsel Littler Mendelson’s analysis of the final rule
• NLRB press release
• NLRB fact sheet
• Joint Employer Small Entity Compliance Guide
• NLRB Joint Employer webpage
• ABC members-only archived webinar, “Learn About Recent Developments at the NLRB Affecting Merit Shop Contractors”