Joint-employer rule: the end of the beginning

The Biden administration announced the formal rescission of the Trump-era joint employer rule will finally take place on October 5, 2021 (https://bit.ly/2XHklS7). The delay was to comply with various administrative procedures. This completes the first step in the arduous process to revamp the characterization of joint employers in accordance with President Joe Biden's proworker agenda.

Almost all of the Trump rule was blocked by a federal district court judge, and the appeal of that ruling is still pending regarding issues unrelated to the substance of the rule. That appeal is not likely to delay the drafting of a new rule that will expand the liability of businesses—largely, but not exclusively, using the franchise model. Under the anticipated rule, the notion of joint employment will be enlarged to include situations in which one employer has authority over some of the terms and conditions of employment—even if that authority does not include rights of hire/fire/pay/discipline and even if the authority is not exercised.

This notion was espoused by former Wage and Hour Administrator David Weil, who has been nominated to return to that job, and that is one of the main reasons his nomination is still pending. Modifications of the joint employer rule and the resulting expansion of shared liability and the possibility of expanded union organizing make this one of the most contested and controversial areas of the Biden labor agenda.