Labor-friendly Democrats struggled Thursday to prevent any more of their party from backing bipartisan legislation dubbed the Save Local Business Act that would rewrite the National Labor Relations Act to limit the number of businesses that can be deemed "joint employers" with other businesses.
Passing the bill is a top priority of businesses, which have made inroads in winning support for it from moderate Democrats.
Three Democrats have co-sponsored the legislation, which would clarify that "joint employer" applies only when one business has "direct control" over another. Supporters argue that many more Democrats are leaning toward the bill but are keeping a low profile to avoid upseting organized labor, which opposes the legislation. A Tuesday briefing for congressional staffers by one business trade association backing the bill drew people from at least a half-dozen Democratic lawmakers' offices.
"We are here today because we are determined to provide that clarity once and for all and protect jobs and small businesses in our communities. I'm proud to say three of our Democrat colleagues, Reps. [Luis] Correa, [Henry] Cuellar, D-Texas, and [Colin] Peterson, D-Minn., are co-sponsors of the Save Local Business Act, and we hope to continue to build bipartisan support so we can restore commonsense to the joint employer issue," said Rep. Bradley Byrne, R-Ala., lead author of the bill, at a House Education and the Workforce Committee hearing.
That bipartisan support is crucial to bill's chances, which is expected to be passed by House later this fall. While House Republicans can pass it on a party-line vote, many assume that only a broader bipartisan margin would give it a chance in the Senate.
Democtrats sought to present the legislation as both anti-worker and anti-business, arguing that it would let large companies off the hook while leaving subcontractors holding the bag.
"This bill is simply an excuse for top corporations to remove any responsibility to their workers. They are subcontracting their consciences to put profits over people," said Rep. Donald Norcross, D-N.J.
But other Democrats aren't viewing it that way. "Franchisees need clarity and predictability on this issue, especially for those franchisees who want to train their workers and do right by their employees," Rep. Bobby Rush, D-Ill., said in a recent interview published in the trade journal Franchising World.
Clarity and predictability are what fans of the legislation argue it will provide. "Joint employer" refers to when one business can be held legally liable for workplace violations at another business. Traditionally, the standard applied when one business had "direct control" of another business' workplace policies, such as a subsidiary. In its 2015 decision in the case of Browning-Ferris Industries, the National Labor Relations Board, the nation's top labor law enforcement agency, changed that standard to the much vaguer "indirect control," which potentially could cover every company that franchises its brand. The NLRB has used it to pursue a major labor rights case against McDonald's Corp., among others.
The change was part of a broader push by former President Barack Obama's nominees to the board to reinterpret old rules and give them a pro-labor twist. It also prompted a major pushback from business to revert to the pre-Browning Ferris "direct control" standard. Byrne's bill would do that. Advocates have made a concerted effort to win over rank-and-file Democrats, enlisting local business owners in the lawmakers' districts to press their case.
Several Democrats during Thursday's hearing said the board's expanded definition was clear, noting that the "direct control" standard was adopted in 1984 and the board was therefore reverting to an earlier standard. "What has happened is [the NLRB] went back to where we were for 46 years," Norcross said.