Democrats can’t even point the finger at President Trump for this one. Not for the lack of trying- but the NLRB shot down Trump’s motion to retract a loose and broad labor law previously. The Obama-era law depressed franchise hotel employment growth and brought down wages across the hotel industry.
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 Daily Caller reported.
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.
Franchisers, companies and pro-business groups have sought to have the ruling overturned. An attempt by President Donald Trump’s NLRB fell flat after Republican board member William Emanuel was forced to retroactively recuse himself from ruling in a case that would affect the 2015 decision.
The NLRB’s broadened joint employer standard reversed decades-old precedent and was particularly consequential for the franchise business model,” AAF director of labor policy Ben Gitis, who authored the study, wrote. “The hotel industry is particularly vulnerable to the economic consequences of the new joint employer standard and two years of data indicate that franchise workers in the industry may already be paying the price.”
Republicans and franchised industries and businesses have widely criticized the Obama-era joint employer ruling and called for it to be vacated or overturned either by the NLRB or Congress.
Unions backed the rule, however. The International Brotherhood of Teamsters (IBT) applauded an NLRB decision to reinstate the Obama-era joint employer rule after the labor board had vacated it for several months only to watch it crash and burn today!