Per POLITICO, the National Labor Relations Board will propose a joint employer rule on Friday that would reverse the Obama-era Browning-Ferris standard, handing a major win to businesses.
The proposed rule addresses the circumstances under which franchisors can be held liable for labor violations committed by franchisees and contractors. President Donald Trump’s NLRB sought to reverse Browning-Ferris last year, but its efforts were thwarted by ethics conflicts with one of Trump’s appointees, William Emanuel.
In a written statement, the board suggested that the proposal would revert to the pre-Obama standard.
“Under the proposed rule, an employer may be found to be a joint-employer of another employer’s employees only if it possesses and exercises substantial, direct and immediate control over the essential terms and conditions of employment and has done so in a manner that is not limited and routine,” the board said.
The board’s three Republican members favored the change, while Democrat Lauren McFerran dissented. The fifth seat remains vacant.
POLITICO has an update on the settlement between McDonald’s and the NLRB that I posted about yesterday. It’s unlikely this settlement will have any impact on other joint employer cases.
A settlement submitted by McDonald’s in administrative law proceedings would “provide 100 percent of back pay” to workers involved in the case, the NLRB said in a written statement today.
The NLRB confirmed reports yesterday of a settlement submitted to Administrative Law Judge Lauren Esposito, saying it represents “a full remedy for all unfair labor practice cases pending.” The fast-food giant has also agreed to a fund to pay out in the event of further breaches of any settlement agreement.
McDonald’s and the NLRB’s Trump-appointed General Counsel, Peter Robb, are eager to reach a settlement in order to avoid creating a precedent holding a major franchiser liable for the labor practices of its franchisees. Robb’s predecessor, Obama-appointed Richard Griffin, argued in filing the case that McDonald’s was a “joint employer” with its franchisees because, among other reasons, it kept close track of franchisee employees through a computer system.
“These settlements represent a full remedy for the employees who have waited since the first charges were filed in November of 2012 and, if approved, would avoid years of possible additional litigation,” the NLRB said.
But the lawyer for workers in the case rejected the NLRB’s favorable characterization and said he would present his objections to the judge.
“This proposal by McDonald’s is not a settlement,” said Micah Wissinger, an attorney representing the workers. “In a real settlement, McDonald’s would take responsibility for illegally firing and harassing workers fighting to get off food stamps and out of poverty.”
Attorneys for Browning-Ferris Industries — the subject of a 2015 NLRB decision that made it easier to hold companies liable for labor violations committed by their franchisees and contractors — filed a motion in federal court today opposing efforts to send the case back to the NLRB.
The motion argued that litigation over the NLRB’s Browning-Ferris decision, which broadened the definition of so-called joint employment, should not be remanded to the NLRB because the board hasn’t yet established what its policy will be going forward on joint employment.
In December, the NLRB reversed Browning-Ferris in Hy-Brand, a pro-business decision that narrowed the board’s definition of joint employment in a way that made it harder to hold companies liable for labor violations committed by their franchisees and contractors. But the NLRB’s inspector general found that William Emanuel, a Trump appointee to the board, should not have participated in Hy-Brand because he had a conflict of interest. After the inspector general’s report, the board vacated Hy-Brand and reinstated the Browning-Ferris standard.
Attorneys representing Hy-Brand last week asked the NLRB to reconsider vacating the decision. The board cut Emanuel improperly out of deliberations on whether to withdraw the decision, the company said. It also alleged that Mark Gaston Pearce leaked advance news of the pending decision to attendees at an American Bar Association conference in Puerto Rico and that Sen. Patty Murray (D-Wash.) compromised due process by revealing publicly the existence of a follow-up inspector general investigation.
The motion filed by Browning-Ferris’ lawyers today argued that the NLRB’s request to reopen Browning-Ferris is “premature,” and that the now-withdrawn Hy-Brand decision “evidences a desire by the board majority at that time to overrule the Browning-Ferris joint employer standard in an appropriate case.”