America’s workers, job creators need the Save Local Business Act
© Getty Images

During the eight years of the Obama administration, the National Labor Relations Board (NLRB) rolled out a series of anti-business policies that hurt workers and job creators alike. Few of these acts were more depredating for employees and employers than the NLRB’s new joint employer standard.  The misguided policy upended decades of labor law representing a direct and existential threat to the franchise industry, forcing job creators to take responsibility for measures far beyond their control, ultimately hurting workers at the behest of big labor bosses.

Before the new joint employer standard, businesses were only liable for employment violations that occurred in workplaces under their “direct control.”  By enforcing a new standard, the liability was expanded to workplaces under their “indirect control,” meaning a business or company could be found liable in a variety of different situations, such as when it contracted work to a completely separate entity.

ADVERTISEMENT

The NLRB’s new joint employer standard meant franchises, which create great economic mobility as they provide ambitious entrepreneurs with pre-packaged business models and concepts, were at risk of never opening their doors, or worse yet, closing them altogether.

According to the International Franchise Association, franchises generate $674 billion in economic impact and are responsible for more than 7.6 million jobs. For such a large economic driver, government should take great care before promulgating burdensome regulations costing employees – in many cases most in need – their jobs.

Thankfully, despite the current political divide in Washington, lawmakers on both sides of the aisle are unified in their opposition to the NLRB’s reckless joint employer agenda. Democratic Reps. Lou Correa (Calif.) and Henry Cuellar (Texas) joined with Republican Reps. Virginia FoxxVirginia Ann FoxxTrump calls North Carolina redistricting ruling ‘unfair’ Women poised to take charge in Dem majority House passes bill putting restrictions on unfunded mandates MORE (N.C.), Tim Walberg (Mich.), and Bradley Byrne (Ala.) to oppose the new joint employer standard.

By introducing HR 3441, The Save Local Business Act, this bipartisan group of elected officials has taken a proactive step toward restoring workers’ rights.

It is no surprise that among the few supporters of the new joint employer standard are union bosses, who pumped millions of dollars into President Obama’s campaigns, expecting and receiving payback in the form of anti-worker and anti-business actions undertaken by a supposed independent agency.

Byrne, who introduced the legislation to end the new joint employer standard, aptly stated, “The people who own these fast food franchises, they’re big time members of our community. They’re the ones we go to get sponsorships for the little league. They’re the ones participating in the Chamber of Commerce.” Thus, the joint employer standard is not a regulation reining in big business, but rather a massive hurdle for small business owners making meaningful impacts in communities across the nation.

The law would amend the National Labor Relations Act and Fair Labor Standards Act to clarify that two or more employers must have “actual, direct and immediate” control over employees to be considered joint employers. In effect, this bill would free national franchise organizations from liability in their local chains, which set their own hours and policies.

Labor Secretary Alexander Acosta withdrew the Department of Labor’s “informal guidance” on the new joint employment standard; however, the NLRB has not rescinded it, meaning it still could be applied.

In order to truly end this flawed policy and create a pro-business environment encouraging growth instead of stifling it, Congress must pass The Save Local Business Act and transfer power away from Big Labor placing it back in the hands of employees and employers.

Heather Greenaway is a spokesperson for the Workforce Fairness Institute (WFI), which advocates on behalf of business owners.


The views expressed by this author are their own and are not the views of The Hill.