Court Axes Obama’s Pro-Union ‘Joint Employer’ Rule
29th December 2018
The National Labor Relations Board (NLRB) ruled in 2015 that companies and franchisers with “indirect and direct control” of employees could be held liable for labor violations committed by contractors or franchisees. The D.C. Circuit Court of Appeals ruled 2-1 that the board did not sufficiently define “indirect” control and sent the 2015 decision back to the board for a more restricted explanation.
The 2015 NLRB ruling overturned more than two decades of precedent while placing businesses at increased risk of violating labor laws. The ruling also empowered unions to negotiate directly with a franchise’s corporate headquarters if franchise employees sought to unionize.
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