The new joint employer rule was defeated
What it means: The new joint employer rule has been defeated, which is a significant victory, especially for franchises.
Our take: “The NLRB’s admission of defeat is a significant victory for small business owners, especially for the franchisors and franchisees who were unfairly targeted by the NRLB’s joint employer rule.” -Patrick Moran, Senior Attorney.
The National Labor Relations Board (NLRB) admitted defeat in an appeal of a district court decision that struck down its new joint employer rule. On July 19, the NLRB voluntarily dismissed the case which was a significant victory for small business owners, especially for the franchisors and franchisees who were unfairly targeted by the NRLB’s joint employer rule.
The new joint employer rule changed the standard for determining whether two businesses are “joint employers”. This would have hurt small businesses and increased business liability for unfair labor practices. Franchises in particular faced ruinous consequences if the new rule’s unclear standards had remained in effect.
“The NLRB’s dismissal of its appeal means small businesses have greater protection from joint employer status. This is a win for small businesses everywhere, especially franchises,” wrote Moran in a blog post.
NFIB opposed the final version of the new joint employer rule, announced a key vote for legislation against the new rule, and as a result, the U.S. House of Representatives passed H.J.Res. 98, disapproving the rule. A further explanation of the victory is available in a new blog post from the NFIB Small Business Legal Center.
