The Labor Department and Trump administration appointees at the National Labor Relations Board, the main federal labor law enforcement agency, are expected to wrap up new rule-makings in the coming weeks that will undo pro-union efforts of the Obama administration.
The DOL and NLRB are expected to issue rules that limit corporate “joint employer” legal liability in workplace violations. The NLRB is also expected to limit union access to workplaces. The DOL is poised to roll back the Obama administration’s fiduciary rule making investment advisers more legally liable.
Rewrites of the “joint employer” rules have been in the works at both agencies for several months. The NLRB version is expected to be announced in early 2020, according to a source with knowledge at the board. The White House concluded the final stage of reviewing the Labor Department’s proposal on Friday but has yet to publish it.
Joint employer refers to when one business can be held liable for workplace violations at another business. Traditionally, this required one business to have direct control over the other business. The Obama administration had sought to make businesses liable even if they merely had “indirect control,” a much vaguer standard that business groups objected to. The NLRB and DOL are both expected to restore the earlier direct-control standard.
The business community closely watched the “joint employer” situation because it threatened to make any company that franchised its brand liable for violations at their franchisees, even if they were otherwise legally separate businesses. Earlier this month, the NLRB settled a long-running case against McDonald’s Corp. by announcing it was not a joint employer with its franchise restaurants.
The NLRB will also issue a rule on whether employers can ban nonemployee union activists from their property. The rule is significant because union protests of companies often involve labor officials who are not employees, as well as other outside activists sympathetic to the union’s goals. That rule is expected in February.
The rule-making is expected to formalize a board decision in a September case called Kroger v. United Food and Commercial Workers. The board said that a company was within its rights to bar protest activity by a union representative from its parking lot, even though the protester was an official with the union that represented its workers. Only a union member who was also an employee had the right to be on the property.
The joint employer and union access rule-makings may be announced even though the five-seat board has just three members, all of whom are Trump-appointees. The board lost its only Democratic member following the end of Obama-appointee Lauren McFerran’s term earlier this month. By tradition, the White House reserves two seats to be picked by the leader of the opposition party, which in this case would be Senate Minority Leader Chuck Schumer, a New York Democrat. An administration spokesman said no announcements were planned and declined to comment further. A Schumer spokesperson did not respond to a request for comment.
Also expected is a revamp of the Labor Department’s fiduciary rule. A federal court last year threw out the Obama administration’s version, which would have required all advisers managing tax-privileged retirement accounts to act in their clients’ best interests. The court ruled that the Obama administration exceeded its authority in enacting the rule. The Trump administration is now preparing its own version. Labor Secretary Eugene Scalia was the top lawyer for the Chamber of Commerce when it successfully challenged the fiduciary rule on court.
