Since President Donald Trump took office in early 2017, he has repeatedly worked to undo things that his predecessor, Barack Obama, did, especially when it comes to things that negatively impacted businesses and industry. The Trump administration rolled back stringent regulations put in place by the Food and Drug Administration and the Environmental Protection Agency, among others.
Now, however, the administration announced that the National Labor Relations Board would publish a new proposed rule today, aimed at rolling back an Obama administration policy to expand the ‘joint employer’ doctrine. Undoing this change would be a positive thing for most businesses, and would likely reduce liability.
The ‘joint employer’ rollback will loosen leftist control over the agency, and over the labor market at franchises, and will protect those who have ‘indirect control’ from being penalized for failures that were not their faults.
The ‘joint employer’ doctrine is concerned with holding one business responsible for the actions of another, or for the workplace violations of another.
During the Obama presidency, the NLRB decided to take the extremely controversial step of expanding the ‘joint employer’ rules.
The changes proposed would have, for example, declared that corporate headquarters were responsible for the actions of their franchisees.
For example, if a McDonald’s owned by a private individual was found guilty of some sort of workplace violations in nonconformity with OSHA regulations and guidelines, under current law, the only group liable is that franchise.
That franchise would be responsible for paying the fines incurred.
Under the planned changes concocted by the Obama-era NLRB, McDonalds corporate would be, at least partially, responsible for the violations and the fines.
This would effectively negate almost any incentive for businesses to allow franchises to operate, especially if they’d be responsible for the failings of whoever ran those franchises.
Instead of allowing this rule change to go into effect, the Donald Trump administration’s NLRB announced a ‘Notice of Proposed Rulemaking.” This served as a basic announcement of their intent to roll back the proposed rules.
If they halt the change, it would maintain the ‘joint employer’ rules as they were maintained for decades, before the Obama administration decided to change them in 2014.
In 2014, the democrat-majority Board announced their decision to expand the rules to include the much more legally vague concept of ‘indirect control.’ The Trump Board would, instead, return to the basis of substantial, direct, and immediate control.
Before the changes can be made and the proposed revisions can be finalized, however, the NLRB must hold public hearings and allow public comments on the proposal.
However, Chairman John Ring said that he hoped that, with the help of public comments and his colleagues on the board, they would be able to craft a final rule that would better clarify the joint-employer standard in a way that would promote “meaningful collective bargaining.”
The rule was essentially a ‘gimme’ to private sector unions during the Barack Obama years, as they argued that the change would make it easier for them to gain new members by targeting the corporate headquarters of large businesses (like McDonalds) instead of having to target an individual franchise.
The Obama rule was also used by the NLRB at the time to pursue a major case against the iconic American cheeseburger franchise. In this case, the executive agency claimed that the corporate entity was responsible for workplace violations at its restaurants, even though the majority were privately-owned and operated entities that simply rented the corporate brand.
An administrative law judge actually rejected a proposed settlement in the McDonald’s case in July.
Franchise owners celebrated the announcement, as did their lobbing groups, including the International Franchise Association. President Robert Cresanti said that the announcement was good news for franchises, franchise owners, and franchise employees across the country.
He also pointed out that owners had been confused about the “vague and uncertain” legal minefield that was created by the Obama administration’s change in 2015.
The political left didn’t seem very interested in the concerns of business owners during the eight years that they controlled the executive agencies.
Instead, they continuously pushed (and in many cases, continue to push) ideas that foisted greater costs and risks upon businesses, including the ‘Affordable Care Act,’ various EPA regulations, and more.
Donald J. Trump was elected to be the President of the United States of America on the basis of a promise that he would make America great again, and that he would create the conditions to bring back a number of industries long thought to be gone.
It seems that the best way he could do that was to do precisely the opposite of what Obama did. It’s worked out well thus far, after all.