WASHINGTON, Nov. 7 — The Coalition to Save Local Businesses (CSLB), which represents more than 3 million small businesses, organizations, and associations, applauds the U.S. House of Representatives for today’s passage of HR 3441, the “Save Local Business Act,” by Rep. Bradley Byrne (R-AL). The bipartisan bill would clarify many of the confusing regulations within the expanded joint employer rule, providing certainty for small business owners while strengthening protections for American workers.
“Full House passage of the Save Local Business Act means local businesses are one step closer to having needed clarity and certainty on joint employer,” said CSLB Executive Director Michael Layman. “Members of the CSLB applaud the hard work of Rep. Byrne and Chairwoman Foxx, as well as original co-sponsors Reps. Henry Cuellar, Lou Correa, and Tim Walberg, who demonstrated real leadership in pursuing a policy that will grow the economy, create jobs, and protect the futures of hard-working Americans. We are hopeful that the Senate will build upon the progress we have seen in the House and take action soon.”
In its 2015 Browning-Ferris Industries (BFI) case, the National Labor Relations Board (NLRB) replaced the traditional “direct and immediate” control joint employer standard with an expanded rule based on “indirect, potential, or unexercised reserved” control – an action which resulted in uncertainty and an unpredictable liability standard for local businesses throughout the country. Consequently, local businesses have also seen expanded joint employment liability under several other statutes, most notably under the Fair Labor Standards Act (FLSA).
HR 3441 would update the National Labor Relations Act (NLRA) and Fair Labor Standards Act (FLSA) to provide clarity for local businesses on what it means to be a “joint employer.” Under this bipartisan legislation, an employer may be considered a joint employer of a worker only if it “directly, actually, and immediately” exercises significant control over the primary elements of employment, such as hiring, firing, determining pay, or supervising employees on a routine basis.
The Coalition to Save Local Businesses is a network of locally owned, independent small businesses, associations and organizations. Below are additional statements from CSLB partners responding to today’s House vote.
Matt Haller, senior vice president of Public Affairs and Government Relations, International Franchise Association:
“For the last three years, local businesses have been forced to operate under the web of uncertainty created by the NLRB through its joint employer expansion. With today’s bipartisan vote on HR 3441, members of Congress have brought local business owners and franchisees one step closer to having the clarity and certainty they need. The 733,000 franchise businesses in our membership contribute 7.6 million jobs and $404 billion to our economy, and with the commonsense direction established by the Save Local Business Act, their potential for continued growth is limitless. On behalf of those local businesses, we thank the House for their hard work and look forward to working with the U.S. Senate to carry that progress forward.”
Cicely Simpson, executive vice president, National Restaurant Association:
“We strongly applaud Congress for standing up for restaurants and small businesses across the country. Today’s bipartisan passage of the Save Local Business Act will restore the clear, traditional standard of joint employment.”
Katherine Lugar, president and CEO, American Hotel & Lodging Association:
“Today’s vote is a win for the small business owners and entrepreneurs who represent three out of every five lodging businesses across the U.S., and the millions of men and women they employ. Two years ago, the National Labor Relations Board redefined what it means to be a joint employer. That decision had a chilling effect on the hotel industry, especially for franchises, who suddenly had uncertainty and confusion about whom they employ and are liable for under the law. We are pleased the House passed this common-sense legislative fix to give small business owners the clarity and certainty they need and spur economic growth.”
Chip Rogers, president and CEO, Asian American Hotel Owners Association:
“Today’s passage of H.R. 3441 marks a monumental step forward in the fight to restore clarity for America’s small business owners, including AAHOA’s 17,000 hoteliers. Prevalent uncertainty has run rampant throughout the franchising and hospitality industries since the 2015 ruling, and is a detriment to local job creators, local jobs and local economies in every single Congressional district. If enacted, H.R. 3441 would restore the commonsense definition of joint employer, a move that would allow AAHOA members to focus on expanding their businesses and creating new jobs. On behalf of AAHOA, I commend the leadership of Chairwoman Foxx, Congressman Byrne, and the bipartisan group of lawmakers whose vote today signaled commitment to protect and defend local businesses and the American Dream. We strongly support immediate action by the Senate in moving companion legislation with urgency. We look forward to working with Senate leaders to that end.”
David French, senior vice president, National Retail Federation:
“Restoring certainty in labor relations is a top priority for retailers, and we appreciate congressional efforts to address the real-world consequences associated with limitless joint employer liability. Without congressional action, retailers and chain restaurants will continue to face unlimited and unpredictable joint employer threats that slow job creation and entrepreneurship.”
Evan Armstrong, vice president of Government Affairs, Retail Industry Leaders Association:
“The retail industry thanks the House for listening to the concerns of America’s job creators and passing this much needed bipartisan legislation. Since the National Labor Relations Board’s (NLRB) decision to overturn decades of sound law to expand the definition of “joint-employer,” employers have been operating in an atmosphere of uncertainty.
“Retail represents vast, complex supply chains throughout the United States and globally. There are numerous relationships between retailers, suppliers, and distributors with the purpose of efficiently delivering goods American consumers want and need on a daily basis. The NLRB’s new standard could harm these complex and dynamic relationships. The Save Local Business Act, provides the clarity and flexibility retailers need to continue to grow and innovate. We urge the Senate to pass this legislation quickly.”
Kristen Swearingen, vice president of Legislative & Political Affairs, Associated Builders and Contractors, which represents more than 21,000 commercial and industrial construction contractors and related businesses:
“The NLRB’s decision to expand the “joint employer” definition will disrupt hundreds of thousands of business operations throughout the country and threaten the ability of hardworking Americans to achieve the American dream of owning their own business. H.R. 3441 will restore the ‘joint employer’ standard that has been in place for over 30 years and bring stability back into the economy for contractors and subcontractors across the country.”
Granger MacDonald, chairman of the National Association of Home Builders, and a home builder and developer from Kerrville, Texas:
“The bipartisan Save Local Business Act offers a common sense solution to the ambiguity created by the NLRB’s 2015 Browning-Ferris decision by affirming that a company may be considered a joint employer of a worker only if it ‘directly, actually, and immediately’ exercises significant control over the primary elements of employment. I should be held accountable for my employees, but not those of another company. Codifying this definition will provide home builders legal certainty that every business owner deserves.”
To learn more about the Coalition to Save Local Businesses and the joint employer issue, click here.