Overnight Regulation

OVERNIGHT REGULATION: Business McFuming over NLRB decision

Greetings from Capitol Hill and welcome to Wednesday’s edition of OVERNIGHT REGULATION, your daily rundown of regulation and enforcement news from around Washington. As always we’ve got all the latest news from the halls of Congress to agencies throughout the federal government, as well as a primer for tomorrow’s must-watch storylines.

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Now, let’s talk about regs.



McDonald’s is decidedly not lovin’ it. That is, if “it” is the decision this week by the National Labor Relations Board’s Office of General Counsel to designate the fast food giant as a “joint employer” for the purpose of employment disputes before the agency.

{mosads}The decision reverberated through Washington and beyond Wednesday, as angered business groups began planning a challenge. Labor and its allies, meanwhile, cheered the prospect of improved bargaining leverage and an end to the legal firewall between corporations and their franchises. http://j.mp/1oIwhcc

— Here’s what you need to know:

1) What NLRB is saying: The labor board’s general counsel is suggesting McDonald’s has joint employer status, along with its franchisees, over the chain’s thousands of workers. If the determination stands, that could expose the company to claims from workers who say their labor rights were violated and could also force corporate management to the table in collective bargaining situations.  

“As the federal governments determination shows, McDonald’s clearly uses its vast powers to control franchisees in just about every way possible. It’s time the company put those same powers to work to do something about the fact that its workers are living in poverty.” — Kendall Fells, organizing director of Fast Food Forward.

2) Industry’s response: Business groups are calling the determination an outrage, saying it could effectively blow up a time-tested business model, and undermine the power of franchisees, who they argue make decisions about wages, hiring and firing. McDonald’s and industry groups are vowing to challenge the finding, which is far from final.

3) What’s next: The determination is likely to result in a formal complaint naming McDonald’s, resulting in arguments before an administrative law judge. The losing side of that case could then appeal to the full NLRB and, after that, the federal courts.

“We certainly would fight that all the way to the Supreme Court if necessary. Our role is to protect the franchise business model and the industry as a whole.” – Jay Perron, vice president of government relations for the International Franchise Association.



And then there was one – legislative day – left before Congress heads out of town for its summer break. Lawmakers in both the House and the Senate are moving toward votes on legislation to address the flood of illegal immigrants pouring into the United States across the Southwest border.

As Congress looks to leave town, President Obama returns later tonight from a quick swing through Kansas City. He is scheduled to deliver remarks Thursday at the Department of Housing and Urban Development.

The Environmental Protection Agency begins the week’s fourth and final two-day public hearing on the agency’s proposal to impose new limits on existing power plants. The hearing in Pittsburgh follows contentious sessions in Atlanta, Denver and Washington, D.C. http://j.mp/1nDzLfc

The Nuclear Regulatory Commission holds a 9 a.m. briefing providing an update on the lessons learned from the Fukushima meltdown in Japan: http://j.mp/1xBdfoQ



The Obama administration will publish 166 new regulations, proposed rules, notices and other administrative actions in Thursday’s edition of the Federal Register.

Highlights include: 

-The Justice Department will issue new ethics rules for federal agents at the Bureau of Alcohol, Tobacco and Firearms (ATF) to make sure they do not have financial interests in companies they regulate.

The new rules are intended to prevent any conflicts of interest that may arise from ATF agents in their lines of work, so that they can remain impartial and objective without having to recuse themselves from certain cases.

“Prohibiting ATF employees from having financial interests in entities that are regulated or inspected by or closely connected to the work of ATF is important for three reasons,” the DOJ wrote.

“First, to maintain ATF’s appearance of impartiality and objectivity in execution of its regulatory and law enforcement functions. Second, to eliminate a regulated entity’s concern that sensitive information provided to ATF might be misused for private gain. And third to avoid the large-scale recusal of employees from official matters resulting in an inability of ATF to fulfill its mission.” http://j.mp/1AySKxs

-The Federal Aviation Administration (FAA) will review a rule that gives people with breathing problems permission to bring their oxygen devices on board, as long as they have a doctor’s note. http://j.mp/1le2tzf

-The Centers for Disease Control and Prevention (CDC) will raise its fees for conducting surprise sanitary inspections on ships that sail overseas to make sure they are clean. http://j.mp/1u19GYG

-The Environmental Protection Agency (EPA) will issue new exemptions from the Clean Air Act to allow companies to use small amounts of methyl bromide, which is a colorless, odorless gas that is believed to deplete the ozone. The chemical was phased out in 2005, but the EPA occasionally provides exemptions to the rule. http://j.mp/1k7YoRW

-The U.S. Department of Agriculture (USDA) will fix a mistake in a poultry rule it published a few weeks ago, governing sanitation procedures. http://j.mp/1rQCFRa



SODA TAX: Rep. Rosa DeLauro (D-Conn.) is pressing legislation that would tax soda and other sugary drinks, in an effort to curb the consumption of a drink that health experts say is not-so-good for you. http://j.mp/1s3tQC0

OUR HANDS ARE TIED: The Environmental Protection Agency says Republicans are making it “very difficult” for the agency to do its job when it comes to regulating carbon emissions at power plants and small bodies of water. http://j.mp/1pGzmpI

COME VISIT: Senate Minority Leader Mitch McConnell (R-Ky.) and other Republicans are calling on President Obama to visit coal country as the EPA considers a controversial climate rule that would cut carbon emissions at power plants. They said Obama should “get his golf cap off, and get his hard hat on.” http://j.mp/ULBxQ6

MORTGAGES: Bank of American will pay $1.27 billion in penalties for shoddy mortgages that one of its subsidiaries sold to government-run companies Fannie Mae and Freddie Mac right before the housing collapse, Reuters reports. http://j.mp/1pr05cj

SHELL COMPANIES, BEWARE: The Treasury Department is moving forward with new rules for banks intended to curb money laundering, Reuters reports. This would require banks to identify hidden account owners and report them to the government. http://j.mp/1uIamq0

NO-NO-CUPID: Online dating website OkCupid could run into trouble with federal regulators for intentionally misleading couples about their compatibility with one another, Reuters reports. http://j.mp/XgMlYm

BUFFERING: The Federal Communications Commission says it is concerned about Verizon’s plan to intentionally slow data speeds for customers with out-dated unlimited plans, Reuters reports. http://j.mp/1kmY1U2



$190 billion: Estimated healthcare costs attributed to the nation’s overweight and obesity epidemic, according to DeLauro’s soda tax bill.

10: Percentage of overall medical spending that the above total reflects.

20: Percent of those costs paid publicly through the Medicare and Medicaid programs.

1: Proposed tax, in percentage, for every 4.2 grams of caloric sweetener added to beverages.



“There is no question that global warming is real and that seven billion people have impacted the world’s climate. There is also no doubt that fossil fuels will be part of our energy portfolio for years to come. Those who choose not to believe that are deniers. We have too many deniers on both sides,” Sen. Joe Manchin (D-W.V.), testifying in Washington on the EPA’s power plant regulation.


We’ll endeavor to stay on top of these and other stories throughout the week, so check The Hill’s Regulation page early and often for the latest. And send any comments, complaints or regulatory news tips our way, via bgoad@thehill.com or tdevaney@thehill.com. And follow us at @ben_goad and @timdevaney.

Tags Bureau of Alcohol, Tobacco, Firearms and Explosives Joe Manchin McDonald's Mitch McConnell NLRB
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