Government affairs

Legislative Updates

NLRB throws out 2017 joint-employer ruling

Today, the National Labor Relations Board (NLRB) issued an order that rescinds its high-profile 2017 ruling that reversed a previous, labor-friendly “joint employer” decision in 2015. That previous decision allowed workers to pursue claims against, or seek collective bargaining with, multiple employers, including the parent companies of  franchised establishments  or companies that outsource work to  contractors. The 2017 ruling was a major victory for U.S. corporations, and a blow to unions.

Today’s decision to throw it out came down to a conflict of interest from William Emanuel, a board member appointed by President Trump, who joined in September 2017 and voted in favor of the pro-corporate ruling.

In a report released on February 9, NLRB Inspector General David Berry stated that Emanuel should not have cast a vote in that ruling due to the fact that he had previously worked for the law firm that represented one of the companies in the original case. Emanuel’s failure to recuse himself from the vote was a clear ethics violation and may constitute serious professional misconduct.

Former NLRB chair William Gould IV believes the situation to be “unprecedented,”  noting “there is no decision on a matter of such high import that has been vacated based upon a breach of conflict-of-interest rules.”

NLRB’s order to throw out the ruling means the labor-friendly decision from 2015 is back in effect.

On November 7, 2017, the House of Representatives passed H.R. 3441, the Save Local Business Act, which would limit “joint employer” status by applying the term only to those that directly exercise “significant” control over the terms and conditions of employment. The bill was introduced in the Senate shortly afterwards.  Should it pass, the  positive 2015 decision would once again be overturned.

NALC will continue to monitor this issue and keep its members up to date.

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