Recently, the U.S. Department of Labor’s Wage and Hour Division (WHD) announced a proposed rule to clarify joint employer status under three major federal labor statutes: the Fair Labor Standards Act (FLSA), the Family and Medical Leave Act (FMLA), and the Migrant and Seasonal Agricultural Worker Protection Act (MSPA). The proposal seeks to establish a single, nationwide joint‑employer standard, replacing the current patchwork of judicial interpretations that vary across federal circuit courts and have created compliance uncertainty for employers operating in multiple jurisdictions.
According to the Department, the proposed rule is intended to simplify compliance while preserving worker protections by drawing from common elements of existing federal court precedent and resolving longstanding inconsistencies among circuits. When a joint employment relationship exists, the proposed rule reiterates that joint employers are jointly and severally liable for compliance obligations under the covered statutes, meaning each employer may be responsible for the full amount of unpaid wages, overtime, damages, or other relief owed to an employee for work performed for all joint employers. By aligning the joint‑employer analysis across the FLSA, FMLA, and MSPA, the Department aims to promote greater uniformity in enforcement and reduce litigation driven by conflicting legal standards.
The Department emphasized that clearer regulatory guidance would benefit both employers and employees. For employers, a consistent national standard is intended to reduce compliance and litigation risk, encourage lawful business partnerships, and improve predictability in WHD investigations. For employees, the proposed rule aims to strengthen protections by clearly identifying when multiple employers are responsible for ensuring payment of wages and compliance with leave and worker‑protection requirements, even if one employer is unable or unwilling to meet its obligations. The Department is accepting public comments on the proposal during a 60‑day comment period that closes on June 22, 2026, and encourages employers, workers, and industry stakeholders to participate in the rulemaking process before the standard is finalized.
You can find more details on the proposed rule here.