Congressional Leaders Call for Delay in Joint Employer Standard

A bipartisan group of nearly 60 members of the U.S. House of Representatives recently called on the House Appropriations Committee leaders to include language in the Fiscal Year 2018 Labor, Health and Human Services, Education and Related Agencies Appropriations bill that would delay the National Labor Relations Board’s (NLRB) new joint employer liability standard.
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A bipartisan group of nearly 60 members of the U.S. House of Representatives recently called on the House Appropriations Committee leaders to include language in the Fiscal Year 2018 Labor, Health and Human Services, Education and Related Agencies Appropriations bill that would delay the National Labor Relations Board’s (NLRB) new joint employer liability standard.

In a letter authored by Reps. Tom MacArthur (R-N.J.) and Henry Cuellar (D-Texas), 55 Republicans and three Democrats asked the Chairman and Ranking Member of the Appropriations Subcommittee on Labor for a temporary, one-year hold on the NLRB’s joint employer liability standard to allow Congress time to determine the effect that it would have on businesses.

The lawmakers urged subcommittee Chairman Tom Cole (R-Okla.) and ranking member Rosa DeLauro (D-Conn.) to protect small businesses from the NLRB’s harmful and confusing new definition of joint employer.

Since 2015 entrepreneurs have been “frustrated and confused,” the lawmakers said, as the 2015 NLRB decision over-turned more than 30 years of bipartisan precedent and eliminated long-standing clarity on employment law obligations of employers.

The NLRB and the Department of Labor in 2015 began revising the “joint employer” standard to expand the scope of determining “co-employment” under the National Labor Relations Act.

Under the expanded “joint employer” standard, a company could be considered a "joint employer" of an employee, with another company, if it possesses the right to control various terms and conditions of employment, regardless of whether the company actually exercises such control. The previous standard required actually exercising control.

Broadening the standard in this manner will expose more companies to legal liability for how their subcontractors, staffing agencies and franchisees treat their employees. The broader standard also makes businesses responsible for providing overtime pay and healthcare benefits to a larger universe of employees, and further makes businesses more susceptible to workforce unionization.

These issues are a specific concern for the travel plaza industry, where the franchisee model is ubiquitous, and where many companies hire "independent contractors" to provide various services for their facilities.

To read 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, see NATSO's Joint Employer Standard/Unionization: Summary And Compliance Guide For Truckstops and Travel Plazas here.

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