U.S. Chamber of Commerce Hosts Event on Joint Employer Issue

Last month, business associations and industry leaders came together at the U.S. Chamber of Commerce to discuss recent efforts to change the standard used to establish joint employment. FAN member and Coalition to Save Local Businesses (CSLB) co-chair Clint Ehlers, a FASTSIGNS franchisee from Pennsylvania, spoke at the event outlining the extreme negative impact that such a radical change in labor policy would have on his business.

Also speaking at the event was Andy Puzder, CEO of CKE restaurants and International Franchise Association board member. “What the NLRB is doing in this respect is simply wrong both factually and morally, franchisors do not joint-employ with franchisee employees,” Puzder said. “The NLRB is trying to make someone responsible for the employment activities, with respect to employees, they don’t employ,” he continued. “We don’t hire them, we don’t fire them, we don’t tell them what do to nor do we tell them when to do it. There’s really no other reason to do this, this is a great business model, people are protected, and everyone understood the relationship when we entered into it. There is only one reason this would happen and that is to empower private sector labor unions.”

“The NLRB is killing the small business model,” added Pratik R. Patel, chairman of the Asian American Hotel Owners Association.

The U.S. Chamber of Commerce’s Workplace Freedom Initiative released a new report titled “Opportunity at Risk: A New Joint-Employer Standard and the Threat to Small Business.” The report contained a comprehensive history of recent challenges to the joint employer standard, as well as analysis of the impact that such changes would have on businesses across the country. Particular attention was given to National Labor Relations Board General Counsel Richard Griffin’s amicus brief in the Browning Ferris Industries, which proposes a new joint employer standard based around indirect or even potential control of a worker’s essential employment conditions. The report states:

“Suffice it to say, if adopted, the General Counsel’s preferred joint-employer test would have significant repercussions for the American economy. It could easily undermine the legal relationships between a great number of businesses and upend the commonly understood rights and responsibilities of those businesses. This would result in increased operating costs for these firms as well as a vaguely defined redistribution of responsibility for many employment and business decisions. This climate of uncertainty and shifting legal liability would do little to promote business growth and job creation.”