On December 8, President-elect Donald Trump named CKE Restaurants CEO Andrew Puzder to serve as Secretary of Labor in his upcoming administration. Mr. Puzder, also an attorney, has consistently been a vocal critic of the proliferation of government regulation during President Obama’s tenure. There is no shortage of Obama administration labor law regulations that the incoming DOL leadership might very well rescind — including the Department’s Persuader Rules, and the Department’s & FAR Council’s Fair Pay & Safe Workplaces Regulations.
Because the Democrats will still hold sufficient Senate seats to filibuster legislative action to reverse these policies, any such rescissions will likely need to go through the extensive rulemaking process. The DOL rulemaking process will require a notice and comment period, the need for a reasoned analysis for why the repeal or revision was necessary, and a 60-day waiting period. It will take time and will likely be subject to judicial challenge by pro-labor entities. Alternatively, it is possible that the incoming administration could decide not to defend these rules, to the extent they are currently enjoined and being litigated, and could consent to a settlement and court order reversing the implementation of these rules.
As the chief executive of the company that owns the Carl’s Jr. and Hardee’s fast-food brands, Mr. Puzder actively opposed the National Labor Relations Board’s agenda to overhaul long-standing joint employment standards. In July 2014, Mr. Puzder testified at a subcommittee hearing of the House Committee on Education and the Workforce, “What Should Workers and Employers Expect Next From the National Labor Relations Board” (along with one of our editors). The Democrats on the panel spent most of the hearing — about the NLRB — attacking Mr. Puzder regarding his opposition to raising the minimum wage. But he managed all the same to address the issue he was invited to discuss, namely: “the NLRB potentially adopting a new joint employer standard that would consider franchisors employers of their franchisee’s employees.” Mr. Puzder testified:
Such a standard would threaten the very successful franchisor- franchisee relationship that has been generating jobs and economic growth for decades. I can’t see the logic of the labor laws requiring or even permitting this.
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[E]xtending the joint employer standard to franchising would not further any purpose of the labor laws. Rather, it would unnecessarily require systemic changes in the franchisor-franchisee relationship, impairing the viability of this very successful business model that has created so many jobs and so much economic growth.
Should the incoming NLRB Members share his views, it may bode well for a return to the reasonable, straight-forward standards that governed these relationships for decades prior to the Board’s Browning-Ferris decision and ongoing McDonald’s litigation.