NLRB Redefines ‘Joint Employer’

The National Labor Relations Board (NLRB) informed the McDonald’s Corporation that the Office of the General Counsel will allow the company to be named as a joint employer of workers at its franchise-owned restaurants. This decision resulted from numerous unfair labor practice charges filed by union-backed groups against franchisees that included the corporation as a charged party.

The U.S. Chamber of Commerce said the Board’s announcement confirmed what many observers suspected would be the NLRB’s next maneuver in its ongoing effort to tilt the playing field in favor of organized labor. It follows a pattern of overturning well-established legal principles and adopting nakedly pro-union policies.

The Chamber also noted a recent labor movement trend has been an ongoing push by worker centers and their union sponsors to organize workers, in order to reverse a six-decade decline in union membership. In the fast food industry, these efforts also have included expensive, made-for-media protests demanding a minimum wage of $15 per hour and union representation.

For unions, the franchise model has presented a hurdle to organizing because franchisors and franchisees have long been recognized as separate businesses. Companies like McDonald’s do not involve themselves in day-to-day hiring and firing decisions and other relevant elements of employment at franchises, such as rates of pay. Thus, the franchisee and franchisor have not been treated as joint employers, because they are not.

Despite that fact, unions like the Service Employees International Union (SEIU) have urged the NLRB to abolish the traditional joint employer standard, and their rationale for abolishing it is simple: it would facilitate unionization. If the McDonald’s Corporation can be made a joint employer, then a successful organizing campaign at a single franchise could force them to the bargaining table. Once there, the SEIU could then attempt to negotiate national card check and/or neutrality agreements covering all franchisees, which subsequently could be quickly picked off, according to the US Chamber of Commerce article. S