NLRB Releases Radical Proposal to Dramatically Expand Joint Employer Liability
Washington, D.C. – On September 6, the Coalition for a Democratic Workplace issued the following statement in response to the National Labor Relations Board’s newly released proposed rulemaking that would radically expand the joint employer standard under the NLRA, creating massive confusion for business operations and labor relations nationwide, inviting unnecessary and costly litigation, and imposing unwarranted liability.
The following can be attributed to CDW Chair Kristen Swearingen:
“Today, the NLRB launched its effort to radically alter labor-management relations, upending years of precedent and jeopardizing the stability of vital business relationships and the American economy overall. The Biden NLRB is threatening to put at risk nearly every contractual relationship nationwide by dramatically expanding the standard used to determine when two or more employers are jointly responsible for a group of employees.
“The NLRB’s proposed rulemaking is more damaging than we anticipated. The proposal goes beyond the controversial Obama-era BFI Board decision by requiring a joint employment determination based on ambiguous concepts of indirect and reserved control. As NLRB Members Kaplan and Ring explained clearly in their dissent, the proposed rule ‘would not merely return the Board to the BFI standard but would implement a standard considerably more extreme than BFI.’
“Whether by accident or design, the proposal disincentivizes larger companies from contracting, franchising or licensing with small and local businesses by injecting uncertainty and unnecessary liability into business relationships. The end result is fewer opportunities for entrepreneurs wishing to invest in their local economy, fewer local jobs, and fewer options for consumers.
“The Board failed to provide any justification for this proposed radical change, which is less clear and harder to apply than the existing 2020 rule, and ignored the DC Circuit’s clear rebuke for ‘oversh[ooting] the common-law mark’ with its BFI decision.
“Members Kaplan and Ring stated in their dissent, ‘The Act’s purpose of promoting collective bargaining is best served by a joint-employer standard that places at the bargaining table only those entities that control terms and conditions that are most material to collective bargaining.’ CDW could not agree more. It’s time for the Board to stop pursuing radical policies at the behest of labor unions, start abiding by the true intent of the Act, and consider the real-life implications of their actions on American workers, business owners, and the economy.”
About The Coalition for a Democratic Workplace
CDW is a broad-based coalition of hundreds of organizations representing hundreds of thousands of employers and millions of employees in various industries across the country concerned with a long-standing effort by some in the labor movement to make radical changes to the National Labor Relations Act without regard to the severely negative impact they would have on employees, employers, and the economy. CDW was originally formed in 2005 in opposition to the so-called Employee Free Choice Act (EFCA) – a bill similar to the PRO Act – that would have stripped employees of the right to secret ballots in union representation elections and allowed arbitrators to set contract terms regardless of the consequence to workers or businesses.