Will Congress Protect Franchise Employees?


Measure Would Overturn Outrageous August 2015 Obama NLRB Decision

From early 2010 until this August, President Barack Obama’s handpicked pro-forced unionism appointees held full control over the National Labor Relations Board (NLRB).

Throughout these years, they executed a series of power grabs that were clearly designed to help union officials seize monopoly-bargaining privileges over as many workers as possible. And one of the most egregious and destructive of the Obama NLRB’s rulings was issued on August 27, 2015.

Obama-selected Chairman Mark Pearce and two other NLRB members declared that, from that day on, franchisors and companies that employ subcontractors and temporary staffing agencies may frequently be regarded as “joint employers” of franchise and subcontractor employees.

This dramatic policy shift was implemented by a 3-2 majority of a bitterly divided Board in deciding a case brought by Teamster union bosses against Browning-Ferris Industries (BFI).

Small Businesses Are Far Less Likely to Cede Workers’ Freedom to Union Officials

Prior to the BFI decision, remote companies were treated as “joint employers” under federal law only if their actions had a “direct and immediate impact” on workers’ terms and conditions of employment, as legal commentator Walter Olson explained in a blog post decrying the ruling.

In contrast, under the NLRB’s extraordinary current policy, remote companies may be regarded as “joint employers” if, in Mr. Olson’s words, “they have the power, even the potential power, to significantly influence working conditions or wages at the subcontractor” or franchisee.

National Right to Work Committee President Mark Mix explained:

“Under decades of precedents, franchisors have never been regarded as employers of workers at independently owned stores, and employees of subcontractors have only rarely been regarded as also being employed by the company that hires the subcontractor.

“Union bosses have long desired to overturn these precedents.

“They know from experience that small companies are far more likely to stand up to Big Labor pressure and refuse to sell out employees who wish to remain union-free than are large firms.

“In order to avoid negative publicity generated by union officials and their allies, large corporations have time and again agreed to so-called ‘card checks’ and ‘neutrality’ deals that actually help Big Labor gain monopoly-bargaining power over employees.”

Measure That Would Protect Franchise, Contract Employees Has Bipartisan Support

By the time this Newsletter edition reaches its readers, the Senate will likely have confirmed Trump-selected attorney William Emanuel as the fifth NLRB member. A majority of seats will apparently be held by opponents of bureaucratic schemes granting Big Labor even more power over individual employees than is authorized by federal statutes.

But the Trump NLRB won’t be able to undo harmful Obama NLRB rulings like BFI until cases challenging those precedents make their way to the Board, and that could potentially take years.

Fortunately, legislation introduced in the U.S. House, known as the Save Local Business Act, or H.R.3441, could potentially protect franchise and contract employees from aggressive unionization drives in the near future.

Mr. Mix noted that H.R.3441, which is sponsored by a total of 44 House lawmakers, including members of both major parties, at press time, would ensure that, when franchises and contract companies refuse to corral their employees into unions, remote companies will not face any legal repercussions.

“And if H.R.3441 becomes law,” added Mr. Mix, “it will be effectively impossible for a future pro-forced-unionism NLRB to reinstate BFI’s skewed ‘joint employer standard’ bureaucratically.

Last month, in a letter distributed to every U.S. House office on behalf of the 2.8 million Right to Work members nationwide, Mr. Mix urged representatives to cosponsor H.R.3441 if they have not already done so and also push for hearings and floor votes on this measure.

(Click here to download the October 2017 National Right to Work Newsletter)