Save Local Business Act
Summary
The "Save Local Business Act" (H.R. 4366) aims to clarify the definition of "joint employer" under the National Labor Relations Act (NLRA) and the Fair Labor Standards Act (FLSA). It seeks to establish a stricter standard for determining when two or more employers can be considered jointly responsible for employees. The bill was introduced in the House of Representatives on July 14, 2025, and reported with an amendment on December 30, 2025.
Expected Effects
If enacted, this bill would narrow the scope of joint employer liability. This could potentially shield businesses from being held responsible for labor violations committed by franchisees or contractors. The change would impact how businesses structure their relationships with other companies and independent contractors.
Potential Benefits
- Potentially reduces legal uncertainty for businesses regarding joint employer status.
- May encourage business investment and expansion by limiting liability.
- Could simplify compliance with labor laws for businesses.
- May lead to more flexible business models and contracting arrangements.
- Could reduce litigation related to joint employer disputes.
Most Benefited Areas:
Potential Disadvantages
- Potentially weakens worker protections by making it harder to hold multiple entities accountable for labor violations.
- May lead to decreased wages and benefits for workers in certain industries.
- Could reduce the ability of workers to organize and bargain collectively.
- May exacerbate income inequality by shifting power towards employers.
- Could lead to increased exploitation of workers through complex contracting arrangements.
Most Disadvantaged Areas:
Constitutional Alignment
The bill's alignment with the Constitution is primarily related to Congress's power to regulate interstate commerce (Article I, Section 8, Clause 3). The NLRA and FLSA are both based on this power. The bill itself does not appear to infringe on any specific individual rights enumerated in the Bill of Rights. However, the impact on labor rights could be debated in relation to the general welfare clause.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).