July 19th, 2024
QSR Magazine: NLRB Ends Attempt to Expand Joint Employer Rule
Restaurants have won the battle against changing the joint employer rule.
The National Labor Relations Board withdrew its appeal of a March ruling in the Fifth District Court of Texas that struck down the federal agency’s wider scope of what a joint employer should be. If the rule had gone into effect, franchisors would’ve been more likely to be held liable for matters at the franchisee level, such as labor violations or union negotiations.
“This announcement means that the latest attempt to implement joint employer is finally finished and represents a landmark victory for franchise small businesses in communities across America,” Matt Haller, IFA president and CEO, said in a statement. “The franchise business model is the best vehicle for American workers to generate upward mobility and create small business ownership from all walks of life. Make no mistake: while today’s news means the current threat is behind us, IFA will remain vigilant against any attempts to target the franchise model or our members.”
The court, in rejecting the ruling, argued the changes were too broad and the rule would treat some companies as employers of franchise or contract workers when they don’t have meaningful control over work conditions. The judge also agreed that the NLRB didn’t adequately consider public input during the commentary phase of the rule-making process. The NLRB said in its withdrawal that it “would like the opportunity to further consider the issues identified in the district court’s opinion.”
Read the entire article from QSR.