Top Five Labor Law Developments For February 2026

1. National Labor Relations Board General Counsel (GC) Crystal Carey issued a new directive calling for less aggressive enforcement of workplace rule violations. Memorandum GC 26-03. The memo reaffirms guidance issued by former Acting GC William Cowen and the rescission of several memoranda issued under Biden-era GC Jennifer Abruzzo. It encourages settlement but discourages the routine use of enhanced remedies (such as notice headings, apology letters, or nationwide postings) in settlement practice. To that end, the memo directs Board regions to promptly seek settlement of pending cases based solely on the maintenance of potentially unlawful rules. It noted such cases are an inefficient use of Board resources where there has been no enforcement or actual impact on employees. The memo provides further guidance aimed at efficiency, such as requiring that charging parties submit supporting evidence within two weeks of filing a charge and regions' requests for evidence be narrowly tailored to promote efficiency. Employers can expect the Board to actively review pending matters to apply these updated protocols.
   
2. The Board reinstated its long-standing employer-friendly standard for determining joint-employer status. 29 C.F.R. § 103.40. The final rule reinstates the 2020 standard issued under the first Trump Administration that vacated the Board's broader 2015 standard under Browning-Ferris Industries of California, Inc., 362 NLRB No. 186. To be found a joint employer under the reinstated rule, a business must possess and exercise "substantial direct and immediate control" over at least one essential term and condition of employment of another employer's employees: (1) wages, (2) benefits, (3) hours of work, (4) hiring, (5) discharge, (6) discipline, (7) supervision, and (8) direction. An employer will not be held to be a joint employer if such control is exercised on a sporadic, isolated, or de minimis basis. The Board determined its issuance of the final rule is "ministerial in nature" because the prior 2023 rule returning to the Browning-Ferris standard was vacated before it took effect. As a result, a notice-and-comment period under the Administrative Procedure Act is unnecessary, the Board said.
   
3. The Board declined to impose financial penalties for an employer's refusal to bargain; the GC issued a memo ending the Biden-era GC's efforts to expand the Board's remedial authority. Longmont United Hospital and National Nurses Organizing Committee/National Nurses United (NNOC/NNU), No. 27-CA-296153 (Feb. 26, 2026). In a divided decision, the two Republican Board members declined to overrule Ex-Cell-O Corp., 185 NLRB 107 (1970), the long-standing precedent holding that the Board lacks authority to award monetary remedies where an employer unlawfully fails to bargain. Reaching the same conclusion, the Board found that requiring employers to compensate employees for "lost opportunity to engage in collective bargaining" would be speculative and would risk undermining the bargaining process itself. The following day, GC Carey's Memorandum GC 26-03 confirmed that the Board will no longer revisit Ex-Cell-O and will review pending matters to withdraw related allegations. Although monetary remedies remain off the table in refusal-to-bargain cases, the Board may still order employers to bargain or post notice.
   
4. A Connecticut federal judge ruled that a business group lacked standing to challenge the state's captive audience law. The law restricts employers from holding mandatory meetings addressing religious or political matters, including unionization, and authorizes civil penalties for violations. The Connecticut Business and Industry Association (CBIA) and several other business groups jointly challenged the statute as unconstitutional. However, the director of the Connecticut Department of Labor's Wage and Workplace Standards Division testified the agency would not seek to enforce the statute against CBIA. Accordingly, the court concluded CBIA failed to show a credible threat of enforcement and therefore lacked standing. Several other states have passed legislation banning captive audience meetings, including Alaska, California, Hawaii, Illinois, Maine, Minnesota, New Jersey, New York, Oregon, Rhode Island, Vermont, and Washington. Employers and business groups have challenged these statutes on federal preemption grounds. On Feb. 23, 2026, the U.S. Supreme Court denied review of a similar decision of the U.S. Court of Appeals for the Eighth Circuit upholding Minnesota's captive audience law.
   
5. Industry groups are urging the Board to establish a more employer friendly test for determining independent contractor status. In a joint petition, the groups called on the Board to adopt a rule grounded in the concept of "entrepreneurial opportunity" and a framework similar to, but more expansive than, the one applied in SuperShuttle DFW, Inc., 367 NLRB No. 75 (2019). SuperShuttle restored the Board's pre-2014 approach for assessing independent contractor status. Under that approach, a qualitative evaluation of common law factors (particularly whether an individual has a significant opportunity for economic gain) would determine whether a worker was an independent contractor without National Labor Relations Act protection. The rule proposed by the groups would go further. It would preclude the Board from considering other factors such as the individual's failure to exercise entrepreneurial opportunity or compliance with legal or regulatory requirements. Although the Board may revise precedent through rulemaking, Bloomberg Law reported that Board Member James Murphy stated at an ABA conference that such an approach "doesn't well suit an adjudicatory agency" and Member David Prouty added that the rulemaking process is significantly time consuming.

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