NLRB Issues Final Joint Employer Rule, Legislation Introduced to Reverse the Action
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On October 26th, the National Labor Relations Board (NLRB) issued a Final Rule amending the Standard for Determining Joint-Employer Status under the National Labor Relations Act. Under the new standard, an entity may be considered a joint employer of a group of employees if each entity has an employment relationship with the employees and they share or codetermine one or more of the employees’ essential terms and conditions of employment, which are defined exclusively as: (1) wages, benefits, and other compensation; (2) hours of work and scheduling; (3) the assignment of duties to be performed; (4) the supervision of the performance of duties; (5) work rules and directions governing the manner, means, and methods of the performance of duties and the grounds for discipline; (6) the tenure of employment, including hiring and discharge; and (7) working conditions related to the safety and health of employees.
The new policy is expected to greatly expand the number of employees considered as joint employers. The Final Rule reverses policies instituted under the Trump Administration and has drawn criticism from industry and some policy makers. There are concerns that the rule is out of touch with American business, workers, and communities. It puts an undue burden on franchisers and small businesses and will lead to higher operational costs and lower opportunity for job creation. Shortly after the NRLB release, Senators Bill Cassidy (R-LA) and Joe Manchin (D-WV) introduced legislation utilizing the Congressional Review Act (CRA) to cancel the NLRB rule. The CRA allows Congress to nullify recently enacted regulations. GCCA and industry partners are calling on Congress to pass the CRA legislation to cancel the NLRB joint employer rule.
