Republican-led labor board overturns Obama-era 'joint employment' ruling

Republican-led labor board overturns Obama-era 'joint employment' ruling

In the 2015 decision, the board ruled 3-2 that Browning-Ferris Industries of California was a joint employer for workers employed by staffing firm Leadpoint Business Services at BFI's Milpitas, Calif., recycling site.

The National Labor Relations Board on Thursday reversed a joint employment standard set by the NLRB in 2015 during the Obama Administration that found companies were joint employers for collective bargaining with unions even if there is only reserved or indirect joint control of workers. Direct and immediate control is a prerequisite to a finding of joint employer status, the board majority said. Franchising or contract labor laws allow companies to avoid the costs of directly employing workers.

The issue of "joint control" has always been a bone of contention with unions who claim McDonalds and other companies have more say so in how their francises operate than they actually do.

Today's decision overruled a case decided last year-E.I. du Pont de Nemours, 364 NLRB No. 113 (2016) (DuPont)-where a divided Board held that actions consistent with an established past practice constitute a change, and therefore require the employer to provide the union with notice and an opportunity to bargain prior to implementation, if the past practice was created under a management-rights clause in a CBA that has expired, or if the disputed actions involved employer discretion.

Joint employment exists when two or more entities exercise some degree of control over the work or working conditions of an employee.

The Browning-Ferris decision made it substantially easier to demonstrate a joint employer relationship by propounding a new test which required only that the entities in question be "employers" within the meaning of the common law, and share or codetermine matters regarding the employee's terms and conditions of employment.

On Thursday, the board said the Democratic majority in Browning-Ferris overstepped its authority by altering the legal definitions of employment.

Today's action by the NLRB comes just over a month after the House voted 242-181 to pass the Save Local Business Act, legislation supported by NRF that would have overturned the Browning-Ferris decision if the NLRB had not acted. A trial began more than two years ago.

This ruling could have a major impact on McDonald's. Some workers who joined the rallies said they were illegally fired, punished or threatened for participating in the protests.

Thursday's decision to reverse the BFI standard was 3-2 and came in a separate case involving the firing of seven workers by Hy-Brand Industrial Contractors and Brandt Construction.

The International Franchise Association and National Restaurant Association, which represents McDonald's Corp. and other fast-food restaurant operators, have been especially vocal critics of the Browning-Ferris standard, arguing that it could doom the franchising industry.

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