House Committee Votes to Kill NLRB Joint Employer Rule, Return to Previous Definition

If Republicans in the U.S. House of Representatives have their way, the National Labor Relations Board’s new standard on “joint employers” will be short-lived.

Under that policy, which the NLRB announced in August, an employer’s exercise of indirect control over working conditions at another employer, or even its reserving the right to exercise that control, is enough to make the two companies joint employers

The 3-2 ruling means that companies that use franchises or subcontractors can be held liable for labor violations by those companies and also be forced to negotiate collective bargaining agreements with unions representing those companies’ workers.

Before this ruling, joint employer required that that one company exercise direct control over the other’s operations. But the board majority said that standard no longer reflects today’s changing economy.

This past Wednesday, however, the House Education and Workforce Committee voted to strike down the NLRB policy. The Protecting Local Business Opportunity Act would amend the National Labor Relations Act to specify two or more employers may be considered joint employers only if each has an “actual, direct, and immediate” control over essential terms and conditions of employment.

The bill now goes to the House floor for final approval, which is expected.

Then it’s onto the Senate, where it has at least one sponsor, Senator Lamar Alexander, a Republican from Tennessee.

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