Joint Employer Rule Reversion — What Construction (and Others) Needs to Know

On February 27, 2026, the NLRB issued a final rule withdrawing the Biden-era joint employer standard and replacing it with the standard adopted during Trump’s first administration in 2020. A federal court had already vacated the 2023 Biden rule, finding it “contrary to law” and “arbitrary and capricious.” The new framework is significantly simpler.

The old (Biden 2023) rule looked at seven factors and required only one to support a joint employer finding: 1) Wages, benefits, and other compensation; 2) Hours of work and scheduling; 3) Assignment of work; 4) Supervision of work; 5) Work rules and directions on the manner and methods of work; 6) Hiring and discharging of workers; and 7) Working conditions related to safety and health.

The 2023 rule allowed a finding of joint employment based on potential or reserved control — not just actual exercise of control. That’s the piece construction industry attorneys called “goofy in the context of construction,” where a general contractor may run a jobsite but rarely directly controls a subcontractor’s specific tradesworker.

The new (2020/2026) rule: If a company possesses AND exercises direct and immediate control over a vital aspect of employment (wages, etc.), then they are a joint employer. The framework requires “power, authority and reality” — not theoretical control.

For construction GCs specifically, this is welcome news. Here are 3 things construction companies (and others) should do:

1. Review your sub/contractor/staffing agreements. Make sure the contracts allocate control clearly and reflect operational reality. “The contract language has to track reality, not the other way around.”

2. Train GC supervisors on the line between coordinating work and directing it. Stepping into a sub’s crew because the foreman is having a bad day is the classic joint-employer red flag.

3. Plan for the next flip. The standard could flip back when Democrats control the White House again, though there is room for a middle ground that exempts industries with a subcontractor business model like construction.

For every employer that operates through contractors, franchisees, staffing firms, or layered employment structures, the underlying lesson is the same: structure your relationships intentionally, and don’t operationally cross the lines your contracts draw.

Is joint-employer policy oscillation just the cost of doing business in a polarized regulatory environment — or does this volatility itself need a legislative fix?