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House GOP Seeks to Block NLRB Joint Employer Decision

By Stephen Lee, Bloomberg BNA

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Washington, December 7, 2015 | comments
Between 40 and 60 House Democrats would support a policy rider to the omnibus spending bill that would block the National Labor Relations Board's recent joint employer ruling, Rep. Brad Ashford (D-Neb.) told reporters Dec. 7.

The rider, which seeks to undo an Aug. 7 NLRB decision that a company can be the joint employer of workers provided by another organization, ranks among Republicans' top priorities, said Rep. Bill Flores (R-Texas) on the same conference call.

“This NLRB blocking provision is one of the key riders that we are demanding be part of any year-end spending bill,” Flores said.

“We're pushing, pushing, pushing to make this one of the top priorities on our side of the aisle in terms of the riders that go into the omnibus,” added Rep. Virginia Foxx (R-N.C.) during the call. “It's just bad policy.”

Rush to Beat Dec. 11 Deadline

Although the NLRB's Aug. 27 decision only addresses whether employees of a temporary staffing firm can be included in a bargaining unit, business groups worry that it could have a spillover effect to the Occupational Safety and Health Administration's multi-employer worksite policy (Browning-Ferris Indus. of Calif., Inc., N.L.R.B., 362 NLRB No. 186, 8/27/15).

Those fears were stoked by an internal memo circulating within OSHA, which suggests that the agency's lawyers are mulling whether joint employer liability can be imposed on a franchisor.

Foxx also said the rider offers a faster way of nullifying the NLRB decision than the Protecting Local Business Opportunity Act (H.R. 3459, S. 2015), which was introduced Sept. 9 but remains stuck in committee.

“It's a much more efficient way of doing it, and it accomplishes the same thing,” Foxx said.

The current government funding expires on Dec. 11. Republicans and Democrats in the House have been working to hammer out a deal and avoid a government shutdown, with policy riders believed to be a sticking point in the closed-door meetings.

Research Highlights Economic Peril

Earlier the same day, a research firm called FRANdata issued a report finding that at least 40,000 small businesses are at risk of failure because of the NLRB ruling.

Dave Gronewoller, a franchisor who operates 12 Golden Corral restaurants in North Carolina and South Carolina, said during the call that he has put on hold his plans to build three new restaurants out of concern that he may be deemed a joint employer along with his franchisees.

But Catherine Ruckelshaus, general counsel and program director at the National Employment Law Project, called the pushback against the Browning-Ferris decision “a real tempest in a teapot,” in part because the decision has “nothing really to do with franchising.”

Rather, the decision focuses only on a staffing agency that sent workers to a waste management location run by the now-defunct Browning-Ferris Industries of California Inc. Franchising is not mentioned at all in the decision, Ruckelshaus said.

Franchisees Welcome Decision, NELP Says

She further said many franchisees actually welcome the decision because it releases them from the sole responsibility for making sure working conditions are complied with.

That can be particularly helpful when a franchisor issues sweeping, exacting commands to its franchisees about how to run the business.

“We've been contacted by franchisees saying they don't understand the International Franchise Association's rhetoric portending doom, because they don't see it as a negative,” Ruckelshaus said. “So I'm a little perplexed about these claims that the sky is going to fall.”

Moreover, employers needn't worry that the NLRB decision will hurt them financially as long as they are good actors, Ruckelshaus said.

“From a franchisor's perspective, it would want to enter into a franchise agreement with good, highly capitalized, sophisticated companies, and then they're never going to hear workers complain about unpaid wages or unionization,” Ruckelshaus said. “It's a quality check on how fast you're expanding your business.”

Impact on OSHA Debated

Other worker activists have argued that the NLRB ruling should have no bearing on OSHA's multi-employer worksite policy, which specifically states that the employer who has actual control of the worksite, or who has the ability to exercise control by contract, may be a controlling employer.

Nevertheless, employer groups have argued that the ruling is suggestive of a broader effort, joined by the White House, to clamp down on the business community.!/articles/NZ0KHL3H0JK0
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