2020 Joint Employer Rule is Officially Reinstated

APPLIES TO All Employers Subject to the NLRA

EFFECTIVE FEB 27, 2026

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look The 2020 NLRB joint employer rule is reinstated. The NLRB will look at direct control over worker terms and conditions of employment to determine joint employer status.

Discussion

With each administration change at the National Labor Relations Board (NLRB), its joint employer rule has fluctuated between the requirement for direct or indirect control over employees’ terms and conditions of employment. The previous 2020 Rule moved away from the broader test that included indirect control as a potential determination of joint employer status, and instead focused on a narrower direct control test. The subsequent 2023 Rule reinstated a version of the broader test that looked at indirect control, but was subsequently vacated on March 8, 2024 by the U.S. District Court for the Eastern District of Texas as being overly broad. Even though the 2023 rule never officially was enforced due to legal challenges, which meant that the 2020 rule remained in effect, the NLRB has now issued a final rule officially reinstating the 2020 rule.

 

Specifically, joint employer status is determined when two employers “share or codetermine the employees’ essential terms and conditions of employment.” Employers must exercise “substantial direct and immediate control” over one or more essential terms or conditions of their employment, including wages, benefits, hours of work, hiring, discharge, discipline, supervision, and direction. “[C]ontrol is not ‘substantial’ if only exercised on a sporadic, isolated, or de minimis basis.”

 

Additionally, evidence of indirect control or a contractual right to control but never exercised is “probative of joint employer status,” but only to the “extent it supplements and reinforces evidence of the entity’s possession or exercise of direct and immediate control.”

 

Finally, each relationship must be analyzed on a case-by-case basis based on their particular circumstances. The burden of proof is on the party claiming joint employer status. While this reinstated rule doesn’t necessarily change current enforcement, employers should still have their joint employer relationships reviewed by legal counsel for potential liability.

 

Action Items

1. Have joint employer relationships reviewed by legal counsel.

 

 

Updated NLRB Case-Handling Guidelines

On February 27, 2026, the NLRB General Counsel issued Memo GC 26-03 outlining updated procedures for handling cases. The memo confirms that all prior guidance from former Acting General Counsel Cowen remains in place, including earlier rescissions and the decision not to revisit certain past Board cases. As part of the update, the Office is currently reviewing open cases and removing any allegations or arguments that no longer apply. The memo also directs regional offices to approve settlements when both parties agree on lawful terms. Stronger remedies, like notice readings, apology letters, or nationwide notices, should only be used in serious or repeat‑violation cases, not as a standard practice. In addition, regions are told to stop prioritizing cases that rely only on the existence of a questionable workplace rule, unless there is evidence that the rule was enforced or that it harmed employees. If an employer agrees to fix the rule, the case should be settled or dismissed. Finally, the memo provides more detailed expectations for how regions should gather evidence going forward.

 

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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2026 ManagEase

Fourth Circuit: Piece-Rate Worker Not Entitled to Additional Hourly Wages

APPLIES TO All Employers with Employees in MD, NC, SC, VA, and WV

EFFECTIVE JAN 13, 2026

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look The Fourth Circuit held that a plaintiff who was properly designated as a piece-rate employee under the FLSA was not entitled to hourly wages and overtime, regardless of online job postings and handbook provisions that addressed hourly pay. The court’s dismissal of the plaintiff’s claims shows employers the importance of consistently documenting the manner in which wages are to be calculated and paid for purposes of overtime.

Discussion

In Figueroa v. Butterball, LLC, the Fourth Circuit Court of Appeals ruled a plaintiff was properly designated as a piece-rate employee under the Fair Labor Standards Act (FLSA) and was not entitled to hourly wages and overtime regardless of online job postings and handbook provisions that addressed hourly pay.

 

Here, the plaintiff was a night-shift turkey loader responsible for catching and loading turkeys onto trucks as well as fueling, sanitizing, and washing the trucks before the next loading process. All turkey loaders kept track of their hours by using a punch clock which Butterball used to calculate overtime pay. Pay stubs were issued that included line items for “OT Hours,” “LoadTrip,” and “AttendHr.” “OT Hours” and “LoadTrip” hours showed 0.00 since the employee was a piece-rate employee. “AttendHr” showed the total hours worked but also showed the amount paid under that line item as 0.00. The plaintiff alleged that Butterball failed to pay him and other turkey loaders hourly wages and overtime pay in violation of the North Carolina Wage and Hour Act (NCWHA) and the FLSA.

 

In reaching its ruling, the court dismissed the state overtime claims under the NCWHA because the law expressly exempts individuals covered by the FLSA from its overtime protections. In addressing the FLSA claims for overtime pay under hourly wage classification, the court found that Butterball explicitly told the plaintiff that he would be paid through a piece-rate compensation system with overtime – not an hourly wage system. He was not owed any additional overtime pay under the piece-rate compensation system. Additionally, the plaintiff was informed of the piece-rate compensation through the line items on the pay stub. The plaintiff also signed an offer letter that explicitly stated Butterball would pay him based on a load rate of $10.80. The plaintiff’s manager and other turkey loaders also testified that it was clear they would be paid under a piece-rate compensation system.

 

The court rejected the plaintiff’s argument that he relied on Butterball’s online job postings and the handbook as evidence of hourly pay. The court stated that a job posting and a general handbook do not override that fact that he signed an offer that stated he would be paid piece-rate and accepted paystubs that displayed “LoadTrip.” The court’s dismissal of the plaintiff’s claims demonstrates the importance of consistently documenting the manner in which wages are to be calculated and paid for purposes of overtime.

 

Action Items

1. Review offer letters for accurate communication of wage and overtime calculations, if applicable.
2. Review timekeeping procedures for piece-rate and hourly workers.
3. Review paystubs for required piece-rate and hourly wage calculations.
4. Have appropriate personnel trained on applicable wage and hour

 

 Fourth Circuit: Employee Must Be a “Qualified Individual” for ADA Protections

APPLIES TO All Employers with Employees in MD, NC, SC, VA, and WV

EFFECTIVE  JAN 14, 2026

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look The Fourth Circuit ruled that an individual must meet the requirements of a “qualified individual” under the Americans with Disabilities Act (ADA) to receive its protections.

Discussion

In Haggins v. Wilson Air Center, LLC, the Fourth Circuit Court of Appeals ruled that an individual must meet the requirements of a “qualified individual” under the Americans with Disabilities Act (ADA) to receive its protections.

 

In this case, an employee who was diagnosed with breast cancer during the COVID-19 pandemic was allowed to work remotely while business slowed down. Once business resumed to normal levels, the defendant employer requested that she come into the office on a hybrid schedule while also taking precautions to limit the spread of disease in the office. However, the employee only came into the office for two partial days in a three-month period and failed to communicate when she would be working from home, in the office, or working at all. Due to repeatedly missing work without notice, the employer discharged her for job abandonment. The employee filed claims for discrimination, failure to make reasonable accommodations, and retaliation under the ADA.

 

In reaching its ruling, the court concluded that the employee did not meet the definition of a “qualified individual” under the ADA. Qualified individuals must be able to perform the essential functions of the job with or without a reasonable accommodation. In this case, the employee could not show up to work to perform the position’s essential functions or timely notify the employer when she would be out of the office.

 

The court found that the employer had exceeded its obligations to accommodate the employee. They allowed her to work full-time while business was down at her full salary. Once business picked up, they requested she return part-time to the office as her schedule permitted and took precautions to limit the spread of disease. In addition, the employer excused the employee’s failure to communicate when and where she would be working. They accepted doctor’s notes with inconsistent dates, allowed her to communicate her in-office schedule each week, explained the specific parts of her duties that needed to be done in person and could not be fulfilled by other employees, and allowed her to work with a mask on and with her office door fully closed. The employee continued to miss work and failed to notify anyone when she would be out sick or working from home.

 

This case highlights the benefits of documenting the employer’s process in communicating with and working with the employee to find suitable reasonable accommodations. This includes properly identifying the essential functions of the job and documenting performance both with and without a reasonable accommodation.

 

Action Items

1. Review accommodation process for qualified employees.
2. Have appropriate personnel trained on accommodation requirements.

 

Fourth Circuit: DEI Executive Order Injunctions Are Removed

APPLIES TO  All Employers

EFFECTIVE FEB 6, 2026

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look The Fourth Circuit lifted a preliminary injunction, which had previously barred the Termination, Enforcement Threat, and Certification Provisions of Executive Orders 14151 and 14173.

Discussion

In National Association of Diversity Officers in Higher Education v. Trump, the Fourth Circuit Court of Appeals vacated a preliminary injunction that had previously blocked parts of certain Executive Orders prohibiting illegal diversity, equity, and inclusion (DEI) programs and activity.

 

Previously, on February 21, 2025, a Maryland Federal District Court issued a nationwide preliminary injunction against enforcement of certain provisions of Executive Order 14151 (J20) titled “Ending Radical Government DEI Programs and Preferencing,” and Executive Order 14173 (J21) titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity.” The main components of the orders that were challenged involved the Termination Provision of J20 (i.e., all executive agencies were directed to terminate “equity related grants or contracts”); Enforcement Threat Provision of J21 (i.e., deter illegal DEI practices by targeting large corporations, organizations, and educational institutions); and Certification Provision of J21 (i.e., requirement of federal contractors to certify that they are not engaging in “illegal” DEI practices). The district court criticized the Executive Orders as being too vague for enforcement. However, the Fourth Circuit stayed that injunction during the appeal soon thereafter.

 

Now, the Fourth Circuit has ultimately found that the plaintiffs lacked standing to challenge the  “Enforcement Threat Provision,” because it merely required an internal government report and did not directly harm or threaten imminent harm to the plaintiffs. Although the court said that plaintiffs did have standing to challenge the “Termination Provision” and the “Certification Provision” because they created real and imminent funding risks, along with a chilling effect on DEI‑related speech and activities, the court ultimately concluded that the plaintiffs were nonetheless unlikely to succeed on their constitutional claims. Specifically, the court said that the Termination Provision was not unconstitutionally vague because it functioned as an internal funding directive, and that the Certification Provision did not violate the First Amendment because it required only compliance with existing antidiscrimination laws. As a result, the court vacated the preliminary injunction and sent the case back to the district court for further proceedings.

 

It is important to note that this ruling addressed what the Executive Orders said on their face, rather than actual application to specific enforcement situations. Legal challenges are likely to continue. Employers should continue to evaluate DEI programs for ongoing compliance with federal, state, and local laws.

 

Action Items

1. Review DEI programs for compliance with anti-discrimination laws.

 

Fifth Circuit: Plaintiffs Need Evidence of Pretext in Discrimination Claims

APPLIES TO All Employers with Employees in LA, MS, and TX

EFFECTIVE     JAN 12, 2026

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look The Fifth Circuit ruled for the employer after finding the plaintiff failed to show that the employer’s stated, nondiscriminatory hiring reasons were a pretext for age discrimination or retaliation under the ADEA and Title VII. Because the employer provided a legitimate business rationale for its hiring decision, and the plaintiff offered no evidence undermining that explanation, the court upheld summary judgment in the employer’s favor.

Discussion

In Awe v. Harris Health System, the Fifth Circuit affirmed summary judgment for the employer after concluding that the plaintiff failed to produce evidence that the employer’s hiring decision was a pretext for discrimination or retaliation under the Age Discrimination in Employment Act (ADEA) or Title VII of the Civil Rights Act of 1964 (Title VII). Here, the plaintiff, a former chaplain, had previously raised concerns about being underpaid along with other minority chaplains. After leaving the organization, he reapplied for a chaplain position but was not selected and subsequently alleged age discrimination and retaliation.

 

The court held that the plaintiff could not establish age discrimination because the hiring record showed that, while two selected candidates were younger, one was older than the plaintiff, undercutting any inference of age bias. Although the plaintiff argued that hiring an older individual was a tactic to shield against an ADEA claim, the court found no evidence supporting that theory. The retaliation claim was similarly deficient because the plaintiff failed to show he was engaged in protected activities. Although he raised claims about being underpaid when he was employed, he did complain that the underpayment was related to his age, meaning he had not engaged in protected activity.

 

The employer was also able to provide a legitimate, non-retaliatory reason for hiring the three individuals in place of the defendant – they had a preference for internal candidates. Because the plaintiff offered no evidence showing that this explanation was false or otherwise a pretext for an unlawful motive, the court affirmed summary judgment.

 

Action Items

1. Review hiring selection processes for neutral, job-related criteria.
2. Have appropriate personnel trained on anti-discrimination and anti-retaliation requirements.

 

Sixth Circuit: EFAA Bars Arbitration of Entire Case When Valid Sexual Harassment Claim is Alleged

APPLIES TO All Employers with Employees in KY, MI, OH, TN

EFFECTIVE   FEB 25, 2026

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look  The Sixth Circuit ruled that the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (EFAA) bars arbitration of an entire case, not just the harassment claim, when a plaintiff alleges a qualifying sexual harassment dispute. Because Congress used the term “case,” the court ruled that all claims filed in the same action, including unrelated ADA claims, must remain in court if the sexual harassment claim is plausible.

Discussion

In Bruce v. Adams and Reese, LLP, the Sixth Circuit Court of Appeals said that the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (EFAA) prevents employers from compelling arbitration of any claims in a lawsuit that contains a valid sexual harassment allegation.

 

Here, the complaint alleged persistent sexual comments and conduct by a supervisor, including repeated remarks about the employee’s appearance, derogatory language, and explicit sexual fantasies discussed in work settings. The court concluded that the alleged behavior was frequent, humiliating, and disruptive enough to plausibly constitute a hostile work environment. Because the claim met the federal plausibility standard, the claim qualified as a “sexual harassment dispute” under the EFAA.

 

Next, the court interpreted the EFAA’s scope, finding that the EFAA invalidates arbitration agreements entered into before a sexual harassment claim arises, both for the sexual‑harassment claim and for the entire “case” when the case is connected to that sexual harassment dispute. Congress used the word “case,” not “claim,” which the court read as evidence that all claims filed together—here, including the employee’s ADA disability‑accommodation claims—must remain in court.

 

Because the employee alleged a qualifying sexual‑harassment dispute, the arbitration agreement was unenforceable for the whole lawsuit. The court therefore denied the employer’s motion to compel arbitration and allowed all claims to proceed in court.

 

Action Items

1. Review arbitration agreements with legal counsel for compliance.

 

U.S. District Court Declines to Lift Stay of Termination of TPS Designation for Haiti

On February 12, 2026, the U.S. District Court for the District of Columbia declined to remove a stay preventing the termination of Temporary Protected Status (TPS) for Haiti. Haiti’s TPS designation and related benefits were to terminate on February 3, 2026, due to a DHS determination that Haiti no longer met the conditions for TPS designation. With the stay continuing to remain in place while the initial legal challenges to the termination continues, USCIS issued limited guidance on the validity of Employment Authorization Documents (EADs) issued under TPS designation for Haiti. EADs with an original expiration date of February 3, 2026, August 3, 2025, August 3, 2024, June 30, 2024, February 3, 2023, December 31, 2022, October 4, 2021, January 4, 2021, January 2, 2020, July 22, 2019, January 22, 2018, or July 22, 2017, have been granted automatic extension per court order. Employers should continue to monitor the USCIS website for updates to the status of Haiti’s TPS designation.

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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2026 ManagEase

Colorado: New COMPS Order #40 and Updates to Wage, Leave, and Youth Employment Rules

APPLIES TO All Employers with Employees in CO

EFFECTIVE FEB 1, 2026

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look The Colorado Department of Labor and Employment has adopted COMPS Order #40, amending administrative regulations implementing the Colorado Wage Act, and released an updated COMPS Order poster. The revisions expand the definition of “employer,” allow localities to increase tip credits consistent with recent statutory amendments, increase employers’ recordkeeping obligations for vacation and sick leave, and tighten rules governing the employment of minors.

Discussion

The Colorado Department of Labor and Employment (CDLE) has adopted Colorado Overtime Minimum Pay Standards (COMPS Order) #40, amended administrative regulations implementing the Colorado Wage Act, and released an updated COMPS Order poster. These updates bring changes to employer compliance obligations across wage and hour, employee leave, and youth employment rules. Key updates are summarized below.

 

Definition of Employer. The updates expand the definition of “employer” to include any individual owning or controlling at least 25% of a business, unless the employer can prove that the owner has fully delegated day‑to‑day operational authority. This change potentially exposes more owners to personal liability under the Colorado Wage Act.

 

Tip Credits. Employers with tipped workers must also adjust payroll practices, as COMPS Order #40 now allows local governments with higher minimum wages to authorize larger tip credits, enabling employers in those jurisdictions to apply a locally‑approved credit while still ensuring workers’ direct wages plus tips meet or exceed the applicable minimum wage.

 

Recordkeeping for Vacation and Sick Leave. Under the updates, employers are required to track not only hours worked, wage rates, and tips, but also detailed vacation and HFWA sick‑leave accrual, usage, and available balances. Employers must be prepared to provide written or electronic leave‑balance information upon request, no more than once per month unless company policy allows more frequent updates.

 

Pay Rate for HFWA Leave. The revised Wage Protection Rules also create more precise standards for determining the rate of pay for leave under the Healthy Families and Workplaces Act (HFWA), with detailed rules for different forms of compensation:

 

• Salary, Commission, or Piece Rate. If the use of leave does not reduce an employee’s pay, such as if the employee is paid solely on a salary, commission, or piece rate basis and the leave does not impact those forms of compensation, then the employee does not earn any additional compensation solely for using leave.
• Salary Plus Commission. If an employee is paid based on salary plus a commission, then the commission is not included in the pay rate.
• Multiple Pay Rates. If an employee works at multiple rates (e.g., they earn shift differentials or work separate jobs for the same employer), the employee is paid the rate they would have earned during the period of sick leave if such a schedule is known at the time the sick leave request is made.

 

Youth Employment Rules. Colorado has also adopted final rules under the Colorado Youth Employment Opportunity Act (CYEOA), which impose stricter compliance obligations on employers who hire minors. The rules further expand and detail prohibited employment for minors, including restrictions on hazardous occupations, use of power‑driven equipment, exposure to toxic substances, and employment in certain establishments such as liquor stores, operation of power-driven machinery, some manufacturing industries, marijuana dispensaries, casinos, and adult entertainment venues. Additional limitations apply to minors under 16 and under 14. The new rules also clarify the CDLE’s Division of Labor Standards and Statistics authority under the CYEOA to investigate complaints, assess penalties, and issue written determinations ordering corrective action, fines, or damages to affected minors.

 

Action Items

1. Display updated COMPS Order poster.
2. Review and update tip-credit practices, if applicable.
3. Review recordkeeping practices for vacation and sick leave for compliance with new requirements.
4. Review HFWA leave compensation practices for compliance.
5. Review and update youth employment practices to comply with expanded minor-employment restrictions, if applicable.
6. Have appropriate personnel trained on the requirements.

 

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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2026 ManagEase

New Jersey: Court Interprets State ESLL for the First Time

APPLIES TO All Employers with Employees in NJ

EFFECTIVE JAN 28, 2026

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look The New Jersey Appellate Division issued the first published appellate interpretation of the state’s Earned Sick Leave Law, which significantly expands potential exposure for employer noncompliance. The court’s ruling emphasizes that statutory sick leave requirements will be strictly enforced, with close scrutiny of exemptions, notice practices and recordkeeping.

Discussion

In Cano v. County Concrete Corporation, the New Jersey Appellate Division issued the first published appellate interpretation of the state’s Earned Sick Leave Law (ESLL), which significantly expands potential exposure for employer noncompliance.

 

In this case, the court found that a concrete supplier’s vacation and PTO policies failed to meet the ESLL’s requirements, holding that paid leave programs must allow employees to take leave for all purposes specified in the statute, not merely vacation, holidays, or bereavement. The court also confirmed that requiring a doctor’s note for absences of fewer than three consecutive days violates the ESLL, underscoring that employers may not impose additional conditions on the use of protected leave.

 

The ruling further clarifies that the ESLL’s “construction industry” exemption is narrowly construed. Although County Concrete argued that it was exempt as a construction‑industry employer, the court rejected this claim, concluding that producing and delivering sand, gravel, and ready‑mix concrete constituted manufacturing, not construction of “houses, schools, or other structures.” The decision makes clear that employers relying on exemptions must evaluate their core business activities, rather than their proximity to the construction industry or the existence of a collective bargaining agreement.

 

The court also highlighted the consequences of failing to meet the ESLL’s notice and recordkeeping requirements. Here, the employer posted notices only at one location and in an inaccessible area, and it did not maintain records showing employees’ accrued and used sick leave. Because the ESLL presumes that an employer failed to provide required sick leave when adequate records are not maintained, the court found that these deficiencies independently supported a finding of liability and contributed to substantial damages.

 

For employers, this decision emphasizes that courts will enforce the ESLL strictly, closely scrutinize any claimed exemptions, and hold employers to the statute’s detailed accrual, use, notice, and recordkeeping rules.

 

Action Items

1. Review PTO policies, postings, and documentation practices for compliance with ESLL requirements.
2. Consult with legal counsel on potential exemptions from ESLL requirements.

 

 

New Jersey: Title IX Preempts Grievance and Arbitration Procedures in CBA

On January 29, 2026, the New Jersey Supreme Court held, in Rutgers v. AFSCME Local 888, that Title IX preempts grievance and arbitration procedures in a collective bargaining agreement (CBA) where those procedures do not provide equal rights to both the complainant and the respondent in a Title IX matter. The court overturned an order requiring Rutgers to arbitrate the termination of an employee found responsible for Title IX violations, concluding that the CBA’s arbitration process conflicted with federal regulations requiring equal procedural protections for both parties because it was only available to the disciplined employee and the union. Although the case arose in the public‑sector context, the court emphasized that similar federal preemption concerns could apply to private universities governed by the NLRA.

 

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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2026 ManagEase