A new federal rule that goes into effect next month could make it easier for millions of workers to form unions at big companies like McDonald’s, the Associated Press reports. However, it’s already facing significant pushback from businesses and some members of Congress.
The rule — announced late last month by the National Labor Relations Board (NLRB) — sets new standards for determining when two companies should be considered “joint employers” under the National Labor Relations Act.
Essentially, the rule could widen the number of companies that must participate in labor negotiations alongside their franchisees or independent contractors. For example, it might require Burger King to bargain with workers even though most of its U.S. restaurants are owned by franchisees. Or it could require Amazon to negotiate with delivery drivers who are employed by independent contractors.
The NLRB says the new rule changes a 2020 rule that made it too easy for joint employers to avoid their responsibility to negotiate with workers. The 88-year-old National Labor Relations Act guarantees the right of U.S. workers to form or join unions.
But critics say the new rule is an overreach by the labor-friendly Biden administration that undermines independent business owners. Some — including the American Hotel and Lodging Association — have already sued to block it.
U.S. Sens. Joe Manchin, a West Virginia Democrat, and Bill Cassidy, a Louisiana Republican, have introduced a Congressional Review Act resolution that would overturn the rule. The resolution must pass both houses of Congress and be signed by President Joe Biden.
Biden hasn’t said whether he supports the new joint employer rule, but he has cast himself as the most pro-union president in history. The new rule is scheduled to go into effect Dec. 26.
The latest rule — passed by a board now controlled by Democrats — more closely resembles the Browning-Ferris ruling from 2015. It says companies may be considered joint employers if they have the authority to control — directly or indirectly — at least one condition of employment. Conditions include wages and benefits, hours and scheduling, the assignment of duties, work rules, and hiring.
The rule only applies to labor relations. The Department of Labor sets its own joint employment standards for issues like meeting minimum wage requirements.
Still, the new rule could have a major impact. Local franchise owners employ more than 8 million people in the U.S., according to the International Franchise Association. Millions more work for subcontractors or temporary agencies.
