After returning from the August congressional recess, lawmakers were quick to introduce a bill that would negate the National Labor Relations Board's recent decision in Browning-Ferris. In this controversial decision, the Board created a new "indirect control" standard for assessing joint employment under the National Labor Relations Act. In the 3-2 decision, the Board determined that if an entity affects the means and manner—either directly or indirectly—of the work terms and conditions of another entity's employees, it will be considered a joint employer with the other entity. This is a radical departure from the prior standard, in which joint employment was found only if the control exercised by the putative joint employer was actual, direct and substantial.
The Protecting Local Business Opportunity Act (H.R. 3459, S. 2015), introduced in the House of Representatives by Rep. John Kline (R-MN) and in the Senate by Sen. Lamar Alexander (R-TN), would amend the NLRA to memorialize the prior long-standing joint employer standard. The provisions of the bill are brief and to the point. The measure would amend Section 2(2) of the NLRA by adding the following language:
Notwithstanding any other provision of this Act, two or more employers may be considered joint employers for purposes of this Act only if each shares and exercises control over essential terms and conditions of employment and such control over these matters is actual, direct, and immediate.
According to the chief sponsor of the bill, if Browning-Ferris goes unchallenged, approximately 780,000 franchise businesses and "millions" of contractors will be affected.
In a press release announcing the bill's introduction, Sen. Johnny Isakson (R-GA), Chairman of the Senate Subcommittee on Employment and Workplace Safety, said:
The National Labor Relations Board (NLRB) has bypassed Congress to overturn decades of established law in its joint-employer decision . . . Changing the joint-employer standard will impede franchising by taking away the benefits of a small entrepreneur being able to start a small business and grow it using a brand name that was established by a major corporation.
Even if this bill were to pass the House and Senate, it would face a certain presidential veto. Opponents of the NLRB decision, therefore, will likely channel their energy towards challenging related cases or limiting the new joint employer standard's implementation through the appropriations process.