U.S. House Lawmakers Introduce Joint Employer Legislation
On Sept. 10, a bipartisan group of U.S. House lawmakers introduced legislation that, if enacted into law, would shield franchise businesses from being designated joint employers under federal labor law.
As a reminder, during the Biden administration, the National Labor Relations Board (NLRB) issued a regulation that would have made it easier for businesses to be held liable for a labor violation committee by a franchisee or contactor. The Metals Service Center Institute opposed that regulation. The new legislation, introduced by Reps. Kevin Hern (R-Okla.) and Don Davis (D-N.C.), would amend the National Labor Relations Act to only allow a company to be considered jointly responsible for a given worker if that business exerted “substantial direct and immediate control” over key aspects of their job.
In a press release, Rep. Hern noted that, in the past, the NLRB’s “ever-changing ‘joint employer’” standards have put “franchise business owners on a regulatory rollercoaster, due to a fundamental misunderstanding of the franchise business model … [resulting] in 376,000 lost job opportunities and a 93% spike in costly litigation.”