On April 21, 2026, the United States Department of Labor published a notice of rulemaking for a new rule to determine “joint employer” status under federal laws like the Fair Labor Standards Act (FLSA) and Family and Medical Leave Act (FMLA).
According to the DOL, “[s]ince 2021, the Department has not provided any regulatory guidance addressing joint employer status under the Fair Labor Standards Act (FLSA or Act) for the benefit of workers, employers, or its enforcement personnel.” This latest notice of proposed rulemaking, however, serves to start the process of developing and finalizing a rule that will provide such guidance.
Of note, the proposed rule consists of sections that delineate different types of “joint employment”—that is, vertical joint employment and horizontal joint employment. It sets out a series of examples on specific situations to further distinguish joint employers from separate employers in both scenarios, vertical and horizontal. In doing so, the proposed rule also comments on what is (and is not) relevant to the joint employment determination.
In addition, the new proposed rule contains sections that address the relevance of certain business models and practices, such as franchising and brand and supply agreements.
While helpful in clarifying many issues surrounding the joint employer debate, the proposed rule has yet to be finalized. Stay tuned for further developments from our Labor and Employment law team.
