POLITICO Pro is reporting on a couple of interesting cases developing out the restaurant industry. One is a potential joint employer settlement between McDonald’s and the NLRB. The other an odd case where a judge holds a Chipotle worker to be in contempt of court over a suit filed under the Obama administration’s overtime rule.
McDonald’s submitted a settlement with the NLRB general counsel to the administrative law judge presiding over its joint-employer case, according to two sources close to both sides in the case.
The NLRB’s Office of the General Counsel sued McDonald’s during the Obama administration, alleging it was jointly liable for the firing of McDonald’s workers employed by its franchisees. But in January a new Trump-appointed general counsel requested a pause in the trial to explore a potential settlement.
Matt Haller, the chief lobbyist for the International Franchise Association, confirmed that McDonald’s submitted its proposed settlement to the court this morning, as did a person close to the workers’ side. The NLRB did not immediately respond to requests for comment.
McDonald’s pushed to settle after the board overturned the Obama-era board’s joint employer standard in December, making it harder to hold the company liable for labor violations committed by its franchisees. But the board withdrew that pro-business decision in February after the NLRB’s inspector general said that William Emanuel, a Trump appointee, shouldn’t have participated due to a conflict of interest.
The fast-food company presented the settlement “as a done deal,” according to the person close to the workers, “but the judge was very clear it’s not done until she says so.” Administrative law Judge Lauren Esposito gave the charging parties 24 hours to decide how much time they need to prepare for a hearing on the settlement.
Pro-business groups are pushing to include a joint employment fix in the omnibus bill expected to come out tonight. Their bill, H.R. 3441 (115), would codify the more pro-business joint employment standard into law.
“The McDonald’s case does nothing to settle the uncertainty for franchisers and franchisees and address the broader question of joint employment,” Haller said.
A federal judge in Texas today held a Chipotle worker in contempt by bringing a suit against the Mexican restaurant chain for back pay under the Obama administration’s overtime rule.
The worker filed a lawsuit against Chipotle last year, arguing that the company withheld time-and-a-half pay under the Obama administration’ rule, even though the rule never took effect because the same court issued an injunction. Attorneys for the worker argued that their lawsuit wasn’t a violation of the court’s order because the court, in issuing an injunction against enforcement, didn’t stop the rule itself from taking effect. They also argued the federal injunction didn’t stop lawsuits under state law.
The judge didn’t agree with that argument and ordered the worker to withdraw the complaint and pay Chipotle’s legal fees.