WASHINGTON, July 29—Associated Builders and Contractors today released the following statement on the U.S. Department of Labor’s rescission of the Joint Employer Status Under the Fair Labor Standards Act final rule.

“While we certainly saw this coming, it is still disappointing the Biden administration rescinded the 2020 joint employer final rule,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs. “ABC supported the prior final rule because it promised to bring additional clarity to a confusing area of the law, help alleviate unnecessary barriers to and burdens on contractor and subcontractor relationships throughout the construction industry, reduce needless litigation and encourage innovation in the economy.”  

Background: The joint employer final rule promised to make the joint employment test narrower and more focused and went into effect on March 16, 2020. In Feb. 2020, 18 states sued DOL in federal court to strike down its joint employer final rule, and in Sept. 2020 a U.S. District Court for the Southern District of New York judge ruled that parts of the final rule were illegal. A business coalition that includes ABC intervened in the case, in part to defend the construction industry against unwarranted attacks by the state plaintiffs on the industry’s long-established methods of doing business. The case is currently on appeal to the Second Circuit Court of Appeals.