House Committee Says Yes to Overturning Joint Employer Ruling

High Rise Apartments and Sky Copyright Serghei Starus — Copyright: Serghei Starus

On October 28, a House committee voted along party-lines to overturn the recent National Labor Relations Board (NLRB) decision to expand the definition of a joint employer. If left unaddressed, the NLRB’s decision could have a significant impact on multifamily firms who may become liable for the actions of subcontractors, suppliers, vendors and temporary staff.

NMHC/NAA have joined an industry coalition in urging strong support for the “Protecting Local Business Opportunity Act,” focused on overturning the ruling. The House bill was introduced by House Education and the Workforce Committee Chairman John Kline (R-MN). Senate Health Education, Labor and Pensions Chairman Lamar Alexander (R-TN) has offered a companion bill that has yet to see action.

The NLRB ruling would require joint employers to negotiate with any union representing the jointly employed workers and share liability for National Labor Relations Act violations. The ruling resulted from the Browning-Ferris Industries case, where the NLRB decided that it could impose joint employer liability when an entity has “indirect” control and “unexercised potential” of control over another entity’s employees.

However, for 30 years before this ruling entities were designated joint employers when both had “direct and immediate” control over “essential terms and conditions of employment.” According to two labor board members who dissented, the ruling will “subject countless entities to unprecedented new joint-bargaining obligations that most do not even know they have."

Matthew Berger mberger@nmhc.org

House Committee Says Yes to Overturning Joint Employer Ruling

October 29, 2015

Staff Resource

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