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The Joint Employer Standard

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A worker puts together an order of Chicken McNuggets at a McDonald’s Corp. restaurant in Little Falls, New Jersey, U.S., on Wednesday, Feb. 15, 2012. McDonald’s Corp., the world’s largest restaurant chain, said sales at stores open at least 13 months rose 6.7 percent globally last month as beverages and Chicken McBites helped the U.S. business. Photographer: Emile Wamsteker/Bloomberg via Getty Images

A couple of weeks ago, the National Labor Relations Board made a hugely pro-worker move, fighting against the joint employer issue, where franchises control all the wages and working conditions but make spurious claims that the franchisee is the real employer. What this means is that if you try to organize fast food, you are organizing against one McDonald’s with the individual franchisee as the owner, instead of, you know, McDonald’s. It is one of the many tricks that employers have used to ensure a union-light America. But Biden has pushed hard against this. Here’s some info on the NLRB move, from a pro-employer law firm so get out your small violins:

On October 26, the National Labor Relations Board (NLRB or Board) announced a new Final Rule that changes the test for determining who is a joint employer.

The rule drastically expands the scope of joint employment, overriding and rescinding the test published by the Board in its 2020 rule. Under the new rule, a business is a joint employer if it has the right to exercise control over any of seven enumerated terms or conditions of employment, even if it never exercises such control, and even if the only way it could exercise such control would be through an intermediary.

The impact of joint employment differs under different laws. This rule affects joint employment under the National Labor Relations Act (NLRA) only. It does not affect determinations of joint employment under federal wage and hour law or any state laws. Under the NLRA and under this rule, joint employers have a duty to bargain, and joint employers can be held accountable for unfair labor practices involving workers they did not think were their employees.

The new rule injects new types of uncertainty into labor relations. The rule will alter the rights and obligations of businesses when dealing with other companies’ employees. The results will often seem unfair or illogical to businesses, and enforcement of the new rule is likely to be selective, sporadic, and inconsistent.

The rule is scheduled to take effect on December 26 – if the rule survives judicial review. And it surely will be tested.

Ah, so sad.

It is indeed being appealed in the courts and the administration is responding:

The federal government is delaying a new rule that could make it easier for millions of workers to unionize after business groups challenged it in court.The National Labor Relations Board said Thursday that the rule — which was scheduled to go into effect in December — will now be effective Feb. 26. The board said the delay will give it time to resolve legal challenges.The rule sets new standards for determining when two companies should be considered “joint employers” in labor negotiations. Under the current NLRB rule, which was passed by a Republican-dominated board in 2020, a company like McDonald’s isn’t considered a joint employer of most of its workers since they are directly employed by franchisees.But the new rule would expand that definition, saying companies may be considered joint employers if they have the ability to control — directly or indirectly — at least one condition of employment. Conditions include wages and benefits, hours and scheduling, the assignment of duties, work rules and hiring.

The U.S. Chamber of Commerce and other business groups — including the American Hotel and Lodging Association, the International Franchise Association and the National Retail Federation — sued the NLRB in federal court in Texas last week to block the rule.

They say the rule upends years of precedent and could make companies liable for workers they don’t employ at workplaces they don’t own. But the NLRB says the current rule makes it too easy for companies to avoid their legal responsibility to bargain with workers.

Joe Manchin is working with Republicans to overturn the rule because of course he is.

This will probably stand. But it will be repealed about 3 seconds after the next Republican president names people to the Board. This is the problem with the partisan nature of American labor relations. You can’t create solid policy if it all changes with every administration.

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