Help Shape What’s Next for NAHB
 
Take the Industry Pulse Check. Learn more
 

Labor Department Issues Final Joint Employer Rule

Codes and Standards
Published

The Labor Department (DOL) yesterday announced a final rule to provide a clearer methodology for determining joint employer status. The rule will provide employers clarity and certainty regarding their responsibility to pay federal minimum wage and overtime for all hours worked over 40 in a workweek.

Where an employee performs work for the employer that simultaneously benefits another individual or entity, the Labor Department provides a four-part test to determine whether the potential joint employer actually exercises the power to:

  • Hire or fire the employee;
  • Supervise and control the employee’s work schedules or conditions of employment;
  • Set the employee’s pay rate and method of payment; and
  • Maintain the employee’s employment records.

Whether a person is a joint employer will depend on all the facts in a particular case. Additional factors may also be relevant in determining whether another person is a joint employer in this situation, but only when they show whether the potential joint employer is exercising significant control over the terms and conditions of the employee’s work.

The new rule will take effect on March 16. It includes a set of joint employment examples to further assist in clarifying joint employer status.

“This final rule furthers President Trump’s successful, government-wide effort to address regulations that hinder the American economy and to promote economic growth,” said Secretary of Labor Eugene Scalia.

NAHB welcomes the rulemaking from DOL's Wage and Hour Division as two other federal agencies similarly seek to narrow their definitions of joint employment. Under the broader interpretations utilized by the Obama administration, builders faced uncertainty about what level of necessary oversight and coordination of their subcontractors might trigger joint employer liability.

For more information, contact David Jaffe.

Subscribe to NAHBNow

Log in or create account to subscribe to notifications of new posts.

Log in to subscribe

Latest from NAHBNow

Economics

May 14, 2026

Building Material Prices Increase at Fastest Pace in Three Years

Prices of building materials used in residential construction, excluding energy, were up 3.7% in April, the fastest pace in three years, according to the most recent Producer Price Index.

Economics

May 13, 2026

Inflation Outpaces Wage Growth for First Time Since 2023

Energy costs drove more than 40% of the monthly increase as national gasoline prices rose to their highest totals in nearly four years.

View all

Latest Economic News

Economics

May 14, 2026

Mostly Unchanged Demand, Lending Conditions for Residential Mortgages in First Quarter

Lending standards and demand for most types of residential mortgages were essentially in the first quarter of 2026, according to the recent release of the Senior Loan Officer Opinion Survey (SLOOS). For commercial real estate (CRE) loans, lending standards for multifamily construction & development were essentially unchanged as well.

Economics

May 13, 2026

Residential Construction Input Prices Move Higher In April

Prices rose across a host of goods and services used in residential construction. Rising energy prices were the primary driver, but transportation service prices also rose at their fastest pace since 2022. Meanwhile, building material prices, excluding energy, rose at their highest yearly rate in three years, up 3.7% from a year ago.

Economics

May 13, 2026

Delinquencies Holds Steady in First Quarter of 2026

Consumer loan delinquency rates continued to normalize in the first quarter of 2026 as pandemic-related disruptions diminished and credit conditions moved closer to historical norms.