House Tables Joint Employer Bill Amid Shaky Republican Support

The viability of a bill that would limit the definition of joint employers is in danger after several Republicans indicated they would not support the measure.

The Save Local Business Act, H.R. 4366, would clarify that a company can only be considered a joint employer if it directly and immediately exercises meaningful control over workers’ essential terms and conditions of employment. The bill has been widely supported by business groups and trade associations, including FEDA, because it would codify that definition into law, preventing the reinterpretation of the term that often occurs when a new presidential administration takes control of the National Labor Relations Board (NLRB).

The most recent redefinition occurred in 2023 under the Biden administration. At the time, the NLRB issued a new rule revising the joint employer rule to cover any entity that had the right to exercise control, including indirect control, over an employee. That version of the rule was vacated by a U.S. district court in 2024, reinstating the 2020 rule that said joint employers had to have direct control.

Last July, FEDA joined 72 business advocacy groups and trade associations in sending a letter to Congress urging the passage of the bill because it would “provide the regulated community with the clarity and predictability it needs to comply with the law and plan for the future.”

It looked like the bill might finally pass last week after it cleared the House Rules Committee on Monday, Jan. 12. However, six Republicans joined Democrats to block the related Flexibility for Workers Education Act, a bill that would have excluded certain voluntary training that occurs outside an employee’s regular working hours from overtime pay requirements. Worrying that the Save Local Business Act would face similar resistance, Republican leaders decided to table the bill for the time being. It is expected the bill will be referred to the House Education and Workforce Committee.