Labor Board Moves Anew to Limit Employers’ Workplace Liability
After This specific was forced to retreat via an effort to make challenging labor practices harder in many workplaces, the National Labor Relations Board is actually moving to achieve the goal through different means.
The board announced on Thursday which This specific was set to publish a proposed rule redefining a company’s responsibility under labor law for workers engaged at arm’s length, such as those hired by contractors or franchisees.
The proposal, reversing an action taken during the Obama administration, might make This specific less likely which a company in such a situation might be deemed a joint employer liable for labor abuses like firing workers seeking to unionize.
In February, a majority on the board voted to vacate its earlier attempt to change the policy, in a decision involving a company called Hy-Brand, after the agency’s inspector general concluded which one of the board members had a conflict of interest along with also should have recused himself.
although the board has authority to change policy both by deciding cases along with also by putting forth rules. Having been stymied in its initial approach, This specific has decided to rely on another.
Philip A. Miscimarra, who was chairman of the board when This specific issued the Hy-Brand decision, said which rulemaking was justified along with also which the task was urgent because the current policy had created uncertainty among employers, workers along with also unions. “The agency has to fix This specific,” Mr. Miscimarra, who was elevated to chairman by President Trump, said in an interview This specific year. Mr. Miscimarra left the board when his term expired at the end of 2017.
Critics accused the agency of seeking to bring about an essentially illegitimate policy.
“After getting caught violating ethics rules once, Republicans on the board are today ignoring these rules along with also barreling towards reaching the same anti-worker outcome another way,” Senator Elizabeth Warren, Democrat of Massachusetts, said in a statement.
Ms. Warren along with also a fellow Democrat, Senator Patty Murray of Washington, played a crucial role in drawing attention to the conflict of interest which undermined the board’s first attempt to revise its joint employer standard.
Before 2015, the law typically required a company to exert direct along with also immediate control over workers at a franchise or subcontractor to be considered a joint employer.
although in a ruling which year, when the labor board had a Democratic majority, This specific altered the standard to ensure even employers which controlled different companies’ workers indirectly — say, through software which locked franchisees into certain scheduling policies — could be considered joint employers. The board also said which a company could be considered a joint employer if This specific had a right to control working conditions at a franchisee’s place of business, even if This specific didn’t exercise which right.
This specific more liberal standard, in addition to potentially exposing more companies to legal liability, made This specific easier for workers to unionize at fast-food restaurants along with also hotel chains. This specific may be illegal for a parent company to terminate a franchise agreement in response to a union campaign by employees of a franchisee if the parent company is actually considered a joint employer.
Last December, the Trump board under Mr. Miscimarra reversed the Obama-era ruling, reverting to the earlier, stricter standard. The ruling was vacated over conflict-of-interest questions involving William J. Emanuel, a board member whose former law firm had played a role in a related case.
The proposed rule could be even stricter than the pre-2015 standard because, according to the board’s announcement, This specific adds the word “substantial” to the words “direct along with also immediate” in listing the criteria for whether a company exercises enough control to be considered a joint employer.
Once the proposed rule is actually published on Friday, the public will have 60 days to submit comments, which the agency is actually supposed to consider in formulating its final rule.
The rule could be challenged in court on procedural grounds, an outcome which Wilma B. Liebman, a Democratic former board member who served as chairwoman under Mr. Obama, said was likely.
Ms. Liebman said groups representing workers might probably argue which the conflict-of-interest problems which undid the earlier attempt to change the joint-employer standard also doom the rule-doing approach in light of Mr. Emanuel’s significant role.
Board custom holds which changing the law requires the support of three members, though This specific is actually not a formal requirement. Mr. Emanuel was one of three members to propose the completely new rule. (The board ordinarily has several members; there is actually currently one vacancy.)
Depending on how the process plays out, the rule could also be vulnerable to arguments which the board did not sufficiently consider public views.
Plaintiffs might argue which “the board majority went into This specific with their minds made up,” Ms. Liebman said. “You have to invite public comment along with also seriously consider This specific, give reasons why you might reject certain ideas.”
If the board does not go out of its way to do so, she said, a court might view the process skeptically, given the events which led up to the rulemaking.
Perhaps anticipating This specific critique, the board’s chairman, John F. Ring, said inside the announcement which he looked forward “to receiving the public’s comments.”
Business groups were enthusiastic about the board’s latest proposal.
“The N.L.R.B.’s announcement is actually not bad news for franchises along with also franchise employees across the country,” Robert Cresanti, president along with also chief executive of the International Franchise Association, said in a statement. “Franchise owners have been confused about the vague along with also uncertain legal minefield created by the N.L.R.B. joint-employer standard since This specific was expanded in 2015.”