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
Jul 14, 2026
How NAHB Helped Two Teens Create a Home Insulation BusinessNAHB’s network of local HBAs provides a springboard for some of the country’s brightest young minds to pursue their goals within the home building industry. Logan Curran and Joe Krysmalski are two of the many examples of young professionals across the country who are seeing results.
Jul 13, 2026
Chairman's Update: The Importance of Advocacy2026 NAHB Chairman Bill Owens spotlights the strength of NAHB's advocacy efforts, including the Legislative Conference and efforts to finalize the 21st Century ROAD to Housing Act that recently became law.
Latest Economic News
Jul 14, 2026
Inflation Cooled in June as Gas Prices EasedInflation slowed to 3.5% in June from a three-year high last month, driven by a mid-June ceasefire agreement that stabilized oil markets and lowered energy prices.
Jul 13, 2026
Two or More Story Home Starts Pull Back in 2025Over half of new single-family homes built in 2025 were two or more stories, according to the recent release of the Census Bureau’s Survey of Construction (SOC). After increasing in 2024, the share of homes started with two or more stories fell in 2025.
Jul 10, 2026
2025 New Single-Family Starts by Census DivisionPersistently high mortgage rates, elevated costs for builders, and ongoing supply-side constraints continued to weigh on single-family construction in 2025.