The Board was initially able to reinstate the definition of joint-employer status through a decision they handed down in 2017. However, the Inspector General determined that their decision couldn’t stand. The reasoning? Board member William Emanuel should have recused himself from the case due to a conflict of interest (he once handled joint-employer cases at his former law firm).
Fortunately, this time around Emanuel has been cleared of any additional conflicts and the rule-making process can continue apace.
As Chairman John Ring explained, “The recusal standard for rule making is very different than for cases.” Since Emanuel is overseeing legislation that would apply broadly to the country and not just a specific case, he is allowed to participate.
The new rule would more specifically define joint-employer status—meaning companies with franchises won’t be forced to collectively bargain with employees they don’t interact with directly. These parent companies also won’t be liable for labor violations committed by their franchisees.
As we’ve said before, the Obama-era rule left a lot of room for interpretation, often confusing the collective bargaining process and resulting in more litigation than cooperation. This was bad news for workers who had no clear pathway to holding their employers accountable.
The 60 day public commentary period for the new rule was extended until December 13th. Even though it could take well into 2019 for the rule to take effect, the NLRB is one step closer to reinstating 30 years of precedent in labor law.