The Small Business Administration has submitted public comments on the 2026 Joint Employer Rule proposed by the U.S. Department of Labor, reflecting IEC’s general support for the rule with a few isolated concerns.
Last month, the SBA hosted a roundtable for small business owners to discuss the proposed rule. Government affairs staff Ben Brubeck and Jeremy Croft were present on behalf of IEC. Both spoke in favor of the proposed rule, with suggestions for minor tweaks to two provisions.
“In several respects, the proposal appropriately moves away from broader theories of joint employment that created uncertainty for legitimate contracting relationships,” said Brubeck at the roundtable. “At the same time, IEC remains concerned that aspects of the proposal — particularly the treatment of reserved control and the consideration of additional open-ended factors — could still create substantial uncertainty and litigation exposure for construction contractors and other small businesses.”
IEC signed comments submitted by the Coalition for a Democratic Workplace on the proposed rule by the June 22, 2026 deadline. In keeping with common practice, the SBA also submitted comments that reflected a summary of concerns raised at the roundtable.
The SBA’s comments highlighted the need to review the rule’s provisions on reserved control and additional factors, similarly to IEC’s own comments.
“The DOL’s 2026 rule states that reserved and indirect control is ‘relevant’ for determining joint employer status, and that the actual exercise of control is ‘more relevant’ than reserved control,” wrote Everett Woodel, Jr. and Janis Reyes, representing the SBA’s Office of Advocacy. “Roundtable participants were concerned that this provision in practice means that reserved or indirect provisions in a contract that are unexercised could subject them have joint employer liability.”
Construction contracts routinely reserve authority regarding safety, scheduling, quality assurance, project coordination, and regulatory compliance. In many cases, contractors are required by law, regulation, or owner mandate to monitor subcontractor compliance in these areas. Prime contractors often reserve this authority but rarely or never exercise direct control over another employer’s workforce, making reserved control distinct from joint employment.
“Small businesses at Advocacy’s roundtable expressed concern that the proposed rule’s allowance for consideration of additional, open-ended factors beyond the four enumerated ones undermines the predictability and uniformity that the rule seeks to achieve,” wrote Woodel and Reyes. “Participants at Advocacy’s roundtable recommend that the DOL finalize a definition of joint employment that clarifies the reserved/indirect control provisions and limit the joint employer analysis to the four enumerated primary factors.”
Overall, Woodel and Reyes recommended adoption of the proposed rule, emphasizing that “it provides clarity, uniformity, and predictability to the employment process.”
The SBA’s direct reflection of IEC’s concerns while supporting the proposed rule indicates that IEC’s voice is being taken seriously in vital conversations shaping the future of the merit shop workforce.
“The relationships of trust and goodwill that IEC has established with key regulatory agencies like the SBA and the Department of Labor are making a positive, tangible impact in Washington on behalf of merit shop electrical contractors,” said Croft.
IEC will continue to keep members informed of regulatory as well as legislative development in the nation’s capital, and will pass along opportunities for public comment or other input as they become available.