SHRM-Supported Legislation to Restore “Joint Employer” Standard Moves in House

Nov 6, 2015

Last week, the House Education and the Workforce Committee approved H.R. 3459, the Protecting Local Business Opportunity Act, legislation strongly supported by SHRM. The bill passed the committee by a party-line vote of 21 to 15. The legislation, if signed into law, would overturn the National Labor Relations Board’s (NLRB’s) Browning-Ferris Industries decision, which fundamentally altered the existing joint employer standard.

As a recap, in rendering its opinion in the case this past August, the NLRB found that “indirect control” or even “unexercised potential” to control working conditions now makes two separate employers joint employers. This decision disrupts a well-recognized, 30-year standard by employers and employees. The previous joint employer standard required an employer to have “actual, direct, and immediate” control over an employee to be considered a joint employer. SHRM, which filed an amicus brief with the NLRB prior to ruling in the case, urged the NLRB to retain the existing definition of a joint employer. Now that the NLRB has ruled otherwise, enactment of H.R. 3459 into law would accomplish this goal.

SHRM expressed strong support for the legislation in a letter sent to Committee Chairman John Kline (R-MN) and Ranking Member Bobby Scott (D-VA). The legislation now has been referred to the full House of Representatives, and a similar bill is pending before the U.S. Senate. Congressional leaders may also look to the appropriations process to attempt to block or delay the implementation of the new NLRB joint employer standard.

Stay tuned for more updates on this important issue from SHRM.

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