NATSO joined 39 trade associations representing millions of job creators in every industry and sector of the U.S. economy in urging the U.S. Senate to take up the House-passed “Save Local Business Act” (H.R. 3441), which would redefine the definition of “joint employer” in the National Labor Relations Act (NLRA) and the Fair Labor Standards Act (FLSA).
In a Feb. 15 letter to the U.S. Senate, the associations said the Senate should stabilize the definition of joint employer in these two key workplace laws by taking up the "Save Local Business Act" as soon as practicable.
The House passed H.R. 3441 in November, however the measure faces an uphill battle in the Senate amid Democratic opposition and a filibuster-proof 60-vote threshold.
The "Save Local Business Act" establishes clear definitions for joint employment under the NLRA and FLSA. Under the bill, an employer may be considered a joint employer of a worker only if it “directly, actually, and immediately” exercises significant control over the primary elements of employment, such as hiring, firing, determining pay, or supervising employees on a routine basis. Enactment of H.R. 3441 would provide certainty for small business owners and other employers in all industries, while clarifying protections for American workers.
The business community has grappled with uncertainty about the definition of joint employer since 2015, when the NLRB ruled in a decision known as "Browning Ferris" that by merely exercising indirect control or possessing unexercised potential control over work conditions one could be a joint employer.
This decision dramatically changed when a company may be held liable for labor violations by other employers they contracted with. Under that ruling, a company deemed a joint employer also would assume bargaining responsibilities if the other employer was unionized, which the International Franchise Association (IFA) has argued could crush the franchisee-franchisor relationship. Previously, a company only established a joint employer relationship when they directly controlled the essential terms and conditions of employment of another company with which they contracted.
Since 2015, businesses have been confused because of the unpredictable joint employer liability yet have faced higher operational and legal costs, decreased business values, less compliance assistance, less growth and fewer opportunities to create jobs.
These issues are of specific concern to the truckstop and travel plaza industry, where the franchisor-franchisee relationships are ubiquitous. Furthermore, NATSO members work with a variety of contract workers such as equipment inspectors and fuel delivery personnel. The nature of this work is such that NATSO members may provide detailed instructions as to how equipment must be inspected to ensure that there are no substance leaks, or when fuel must be delivered to minimize disruptions and potential dangers. An expanded joint employer standard therefore could penalize truckstop owners by viewing these work requirements as indicative of a joint employer relationship.
NATSO members may access a detailed analysis of the NLRB’s effort to revise the joint employer standard, and the Department of Labor’s guidance on independent contractors, including a discussion of the potential affect this could have on NATSO members. Click here to access NATSO’s Joint Employer Standard and Compliance Guide for Truckstops and Travel Plazas.
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