The National Labor Relations Board has formally withdrawn its 2023 joint-employer rule and restored the prior, narrower 2020 standard. This is a significant development for construction because contractors, subcontractors, staffing companies, labor brokers, and construction managers often work within layered employment relationships on the same project.
Under the restored standard, joint-employer status generally requires evidence that one entity exercises substantial direct and immediate control over essential employment terms of another employer’s workers. That is a more contractor-friendly approach than the broader 2023 rule, which would have increased risk where a contractor merely reserved authority or exercised indirect control over employment conditions.
👉 Takeaway: Construction employers should welcome the added certainty, but they should not treat the change as a license to blur employment lines on the jobsite. Prime contractors and construction managers may enforce contract requirements, safety obligations, project schedules, quality standards, and site rules. However, they should avoid directly supervising, disciplining, assigning, hiring, firing, or controlling the pay of another company’s employees. Field personnel should communicate through the subcontractor’s designated supervisor whenever possible and document that the subcontractor remains responsible for its own workforce.
