In a decision providing significant relief for employers, a federal court in Texas struck down the National Labor Relations Board’s (NLRB) 2023 joint employer rule.[i] Being designated a joint employer by the NLRB can have far-reaching consequences for a business, including potential obligations to negotiate with unions representing workers not directly employed by the business and shared liability for labor law violations committed by another employer. The court’s decision puts on hold the NLRB’s rule which would have expanded employer liability under the National Labor Relations Act (NLRA), particularly for businesses that regularly utilize contractors or franchising models and leaves intact the more predictable and business-friendly joint employer standard the NLRB sought to supplant with its rule.
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