A bipartisan group of 83 House lawmakers this week urged the National Labor Relations Board, the main federal labor law enforcement agency, to roll back an Obama-era rule called ‘joint employer’ that vastly expanded legal liability for business, especially those that franchise.
Joint employer refers to when one company is so closely involved with another business that it can be held responsible for any workplace violations there. Until 2015, the definition of joint employer required one company to have direct control over another. The Democratic appointee-majority NLRB during former President Barack Obama’s administration broadened that to the much vaguer “indirect control.” The lawmakers urged a return to the prior standard.
“In that ruling, the NLRB overturned decades of bipartisan legal precedent by replacing the predictable and clear test based on ‘direct and immediate control’ standard for determining joint employer status,” said the lawmakers, lead by Rep. Bradley Byrne, R-Ala., in a letter sent Wednesday. “The decision exposed a huge swath of the business — from contracts and service providers to franchisors and franchisees — to workplace liability.”
The letter is signed mostly by Republican members, but it also includes Rep. Henry Cuellar, D-Texas.
The rule has been heavily criticized by trade associations, which have made overturning it a priority. Last year, the House passed the Save Local Business Act, which would restore the direct control standard, but the legislation stalled in the Senate. With the House returning to Democratic control next year, it is unlikely that similar legislation could pass next Congress.
President Trump’s nominees to the board are currently revisiting the rule and earlier this week extended the period for public comments for another month, giving interested parties until mid-January to weigh in.
Last year, in a case called Hy-Brand, the NLRB overturned the case that was the basis for the Obama-era rule, called Browning-Ferris. However, the board subsequently vacated the Hy-Brand ruling after its Office of the Inspector General determined that board member William Emanuel should have recused himself due to a conflict of interest with his old law firm Littler Mendelson. Emanuel has said he was under no such obligation and called the OIG’s finding “absurd.”
