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Federal Judge Invalidates SWACCA-Supported Joint Employer Final Rule

Late Friday, a judge in the U.S. District Court for the Eastern District of Texas struck down the National Labor Relations Board’s final joint employer rule that broadened the legal test for determining when multiple companies jointly employ workers and thus share liability and obligations under federal labor law. Back in 2022, SWACCA’s General Counsel submitted comments on the NLRB’s proposed joint employer rule that highlighted SWACCA’s support for rescinding the previous Administration’s joint employer standard and replacing it with the NLRB’s October 2023 final rule because it will help to reduce employee misclassification in the construction industry.

In last Friday’s ruling, District Court Judge J. Campbell Barker agreed with the plaintiffs in the case that the final joint employer rule was too broad and violates federal labor law. Barker said the rule is invalid because it would treat some companies as the employers of contract or franchise workers even when they lacked any meaningful control over their working conditions. The NLRB is expected to appeal the ruling to the U.S. Court of Appeals for the Fifth Circuit.

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