You are here

Legal Updates Laundromat Owners Should Know in 2024 (Part 1)

Joint Employer Rule affects more than many small-business owners realize

CHICAGO — As a new year opens, small-business owners — including most owners of self-service laundries — may find themselves facing new rules that will have a direct impact on their businesses.

In order to educate owners on possible challenges in 2024, the National Federation of Independent Business (NFIB) recently hosted “The 2024 Small Business Landscape — Legal, Regulatory, and Economic Updates for the New Year,” a webinar designed to shed light on some of the new rules that have been, or soon will be, put into place.

“Many of these are rules that I will say at the outset that NFIB has opposed or worked to lessen the impact on small businesses,” says Beth Milito, executive director of the NFIB’s Small Business Legal Center, “with some areas finding more success than others.”


The new Joint Employer Rule, which goes into effect Feb. 26, applies to those businesses where an employee might be considered working for more than one company in their position.

This rule, Milito says, might apply more widely than most small-business owners might realize.

“This is a rule coming out of the National Labor Relations Board,” she says, “and you might think to yourself, ‘I’ve heard that term, the acronym NLRB, but I don’t have employees in my business who are in a union.’ Well, make no mistake, the NLRB is interested in all employer businesses, whether unionized or not, and that is because all employees in the country have the right to engage in concerted activity.”

"Concerted activity,” Milito continues, “is activity to improve working conditions, so that’s a very broad term. The National Labor Relations Act confers on all employees and the private sector to engage in concerted activity. So that gives the NLRB the ability to regulate your business, whether or not you have unionized employees who belong to a union or have signed a collective bargaining agreement.”

How does the new joint employer rule impact businesses?

“It essentially means that more employees in the country are going to be considered employees of more than one employer,” Milito says, giving the example of a company that franchises. Under this new rule, if there is a labor law violation, both the franchisee and the corporate business could be found liable. 

Milito also gave the example of a home building contractor and a drywall subcontractor, where both could be found liable for labor law violations.

The Joint Employer Rule states that if a business other than the main employer has any authority to control certain employment terms, it will be considered a joint employer. Some of these terms include:

  • Wage, benefits and other compensation
  • Hours of work and scheduling
  • Assignment of duties
  • Work rules and direction, including grounds for discipline
  • Tenure of employment, including hiring and discharge
  • Working conditions related to the safety and health of employees

Milito then offered the following points where the new rule might impact small-business owners:

  • Under the new rule, more businesses will have to bargain with labor unions and may be subject to union picketing and boycotts, as well as unfair labor practice claims.
  • The rule applies to every business that falls under the National Labor Relations Act, which is most private-sector businesses.
  • Franchises may have to choose between reducing a franchisor’s involvement in a franchisee’s operation or opening themselves up to collective bargaining and litigation.
  • Businesses that rely on staffing agencies or other firms to provide temporary or seasonal labor may also be subject to this rule.

Milito gave some tips for owners who might fall into this category of employment:

  • Evaluate your agreements—especially franchise agreements—to determine if another business may have authority over any of the listed employment terms.
  • Closely examine your training materials or any other documents to ensure that you have not accidentally created a joint employer relationship.
  • When in doubt, contact an attorney to help in your review.

“This is a way for the NLRB to find more than one business liable for labor law violations,” Milito says. So, this is challenging for small businesses and for subcontractors, too.”


“Many small businesses received relief credits through the Employee Retention Tax Credit (ERTC),” Milito says. “This was a COVID program that started in 2020 and received a lot of attention. It really was a lifesaver for many businesses that continued to keep their employees on payroll throughout the pandemic.”

While the program helped many who needed it, it was also a target for those with less-than-honest intentions.

“Unfortunately, there was a bit of fraud that occurred with the program and, frankly, the IRS became overwhelmed with ERTC claims.” Milito says. “As a result, earlier this year the IRS paused the processing of ERTC claims. The IRS, despite what some news reports have said, did not stop the program or cancel it — it paused the processing of the claims.”

The IRS was preparing to restart processing this month, she says.

“They’ve taken this pause period to hire and train additional employees and also to put out a lot of publications and help for small businesses that might have filed claims that were ineligible. So, there’s a process now for businesses who may be filed an ERTC claim and now think they might not have been eligible. These businesses can go back and fix claims.”

The IRS, Milito says, is soon going to resume the processing of the ERTC program claims, which can still be filed through April 15, 2025.

“They’re going to go in the order received, and I heard that’s the exact phrase a treasury official used,” Milito says, “He said that, if you think you have a legitimate claim that your CPA has gone through (and) you believe you are eligible for this credit, go ahead and file it now, because when they resume processing in January 2024, they’re going to process the claims in order received.”


The U.S. Citizenship and Immigration Services (USCIS) has published a new version of the Employment Eligibility Verification form, Form I-9. This is the form that is used to verify identity and eligibility to work in the United States.

“This is the form that has been around since the 1980s,” Milito says. “There’s no exemption for small businesses for filling out the I-9. An I-9 must be filled out for all employees hired — and that's employees, not independent contractors.”

The new I-9 form has been simplified and is now down to one page.

“Homeland Security tried to make the instructions more clear,” Milito says. “I leave it to you to decide whether or not they’re more clear. I’ve looked at it myself and I think it’s a little bit better, and it’s nice that it’s down to one page.”

Come back Wednesday for Part 2 of this series, including the details of a new overtime rule proposed by the U.S. Department of Labor

Legal Updates Dry Cleaners Should Know in 2024

(Image licensed by Ingram Image)

Have a question or comment? E-mail our editor Bruce Beggs at [email protected].