In December of 2014, the National Labor Relations Board (NLRB) Office of General Counsel moved forward with its efforts to hold McDonald’s USA, LLC vicariously liable as “a putative joint employer” with a number of its franchisees. The Office of General Counsel previously threatened this enforcement action in the summer of 2014.
The Office of General Counsel filed complaints against McDonald’s in 13 different regions. The complaints cover 78 separate charges of unfair labor practices including “allegations of discriminatory discipline, reductions in hours, discharges, and other coercive conduct directed at employees in response to union and protected concerted activities, including threats, surveillance, interrogations, promises of benefit, and overbroad restrictions on communicating with union representatives or with other employees about unions and the employees’ terms and conditions of employment.”
The inclusion of the franchisor, McDonald’s USA, LLC, as a “putative joint employer” is widely viewed as part of a broader effort by the Office of General Counsel to change the current joint employer standard under the National Labor Relations Act (NLRA). If successful, the application of the new joint employer standard – which focuses on whether “meaningful bargaining” can occur without the alleged joint employer – will likely raise the risk of vicarious liability under the NLRA for franchisors generally, not just McDonald’s.
In support of including McDonald’s USA, LLC as “putative joint employer” in each of the 13 complaints, the Office of General Counsel issued a “fact sheet” explaining that:
Our investigation found that McDonald’s, USA, LLC, through its franchise relationship and its use of tools, resources and technology, engages in sufficient control over its franchisees’ operations, beyond protection of the brand, to make it a putative joint employer with its franchisees, sharing liability for violations of our Act. This finding is further supported by McDonald’s, USA, LLC’s nationwide response to franchise employee activities while participating in fast food worker protests to improve their wages and working conditions.
Takeaway: The new McDonald’s cases are important test cases for the Office of General Counsel’s efforts to implement a new joint employer standard under the NLRA. Franchisors, in particular, should continue to monitor these cases to see whether the NLRB will adopt a new joint employer standard.