Final NLRB Joint Employer Rule is a Win for Small Business Community
In an important win for NAHB members and the small business community, the National Labor Relations Board (NLRB) released a final rule that clarifies the standard for determining whether two employers are joint employers of a group of workers under the National Labor Relations Act.
This resolves the NLRB’s controversial 2015 decision in the case of Browning-Ferris Industries that radically expanded the traditional test for establishing joint employment. Today’s final rule specifies that an employer may be considered a joint employer of a separate employer’s employees only if the two employers share or codetermine the employees’ essential terms and conditions of employment, which are exclusively defined as wages, benefits, hours of work, hiring, discharge, discipline, supervision, and direction.
Importantly, the final rule retains the requirement that direct and immediate control over essential terms and conditions of employment be “substantial” to give rise to joint-employer status. Control is substantial if it meaningfully affects matters relating to the employment relationship. Such control is not “ substantial” if it is only exercised on a sporadic, isolated, or de minimis basis.
Indirect influence and contractual reservations of authority are no longer sufficient to establish a joint-employer relationship.
NAHB views this NLRB ruling as a positive development because it provides home building firms and small businesses clarity and certainty regarding the joint employer rule by restoring the traditional definition of joint employment in which a company must exercise “direct and immediate control” over a worker in a business-to-business relationship.
In announcing the final rule, NLRB Chairman John Ring said: “With the completion of today’s rule, employers will now have certainty in structuring their business relationships, employees will have a better understanding of their employment circumstances, and unions will have clarity regarding with whom they have a collective-bargaining relationship.”
For more information, contact David Jaffe at 800-368-5242 x8317.
Latest from NAHBNow
Jan 02, 2026
Trump Delays Higher Tariffs on Furniture, Kitchen Cabinets for One YearPresident Trump has announced he will be rolling back higher tariffs on furniture, kitchen cabinets and vanities that were set to go into effect on Jan. 1, 2026, until Jan. 1, 2027.
Jan 02, 2026
FHA’s MMI Fund Capital Ratio Remained Solid in Fiscal Year 2025The capital reserve ratio for the Federal Housing Administration’s Mutual Mortgage Insurance Fund ended the fiscal year at 11.47% — unchanged from the capital ratio for fiscal year 2024 and well above the congressionally mandated 2% capital ratio.
Latest Economic News
Dec 22, 2025
State-Level Employment Situation: September 2025In September 2025, nonfarm payroll employment was largely unchanged across states on a monthly basis, with a limited number of states seeing statistically significant increases or decreases. This reflects generally stable job counts across states despite broader labor market fluctuations. The data were impacted by collection delays due to the federal government shutdown.
Dec 19, 2025
Existing Home Sales Edge Higher in NovemberExisting home sales rose for the third consecutive month in November as lower mortgage rates continued to boost home sales, according to the National Association of Realtors (NAR). However, the increase remained modest as mortgage rates still stayed above 6% while down from recent highs. The weakening job market also weighed on buyer activity.
Dec 18, 2025
Lumber Capacity Lower Midway Through 2025Sawmill production has remained essentially flat over the past two years, according to the Federal Reserve G.17 Industrial Production report. This most recent data release contained an annual revision, which resulted in higher estimates for both production and capacity in U.S. sawmills.