A U.S. labour board on Thursday issued a final rule making it easier for workers and unions to hold companies liable for labour law violations by their franchisees and contractors, reviving an Obama-era standard heavily criticized by trade groups.
A company that is found to be a joint employer would likely be forced to become more involved in setting and implementing workplace policies, and could be required to bargain with unions.Joint employment has been one of the most contentious labour issues for many U.S. businesses since the Obama administration, when the NLRB had adopted a similar standard that trade groups said was unworkable and would curb franchising.
NLRB Chair Lauren McFerran in a statement called the new rule “a legally correct return to common-law principles” and a practical approach to ensure that the entities that effectively exercise control over workers’ terms of employment respect their bargaining obligations. Business groups have said the rule would further complicate collective bargaining, making it more difficult for unions to negotiate contracts with businesses and undermining the NLRB’s stated goal of strengthening workers’ rights.
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