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Proposed NLRB joint employer rule may not need further input

Posted On: Nov. 6, 2018 7:00 AM CST

Proposed NLRB joint employer rule may not need further input

The National Labor Relations Board’s refusal to comply with the request of Democratic lawmakers to hold public hearings on its proposed joint employer rule — and its decision to extend the comment period by only 30 days instead of the 60 days they asked for — makes sense in light of the voluminous input the board already has received on the issue, say many observers.

Experts say also they anticipate the proposed rule will be approved by the board essentially as presented.

The proposed rule’s approval will help businesses “stave off potential liability” for unfair labor practices under the National Labor Relations Act, said David J. Przybylski, an Indianapolis-based partner with Barnes & Thornburg LLP’s labor and employment department.

The requests for the additional time and public hearings were made by Sen. Patty Murray, D-Wash., and Rep. Robert C. Scott, D-Va., in an Oct. 10 letter to the board.

Sen. Murray is the ranking Democratic member of the Senate Committee on Health, Education, Labor and Pensions, while Rep. Scott is ranking Democratic member of the House Committee on Education and the Workforce.

The new rule proposed by the NLRB in September would revoke the 2015 ruling by the then Democrat-controlled board.

In its 2015 3-2 decision in Browning Ferris Industries of California Inc., the NLRB overturned the standard in place since 1984 that firms must have an “immediate and direct” control over a worker to be considered a joint employer.

It held instead that a company only needs to have indirect control of a worker, and to not even exercise that control, to be considered a joint employer. The proposed new rule would return to the “immediate and direct” control standard.

The public was initially asked to submit comments on the proposal by Nov. 13. In their letter to the NLRB asking for both an extension and public hearings, Sen. Murray and Rep. Scott asked for additional information related to the issue by Oct. 22. It said the agency’s notice of proposed rule-making “provides scant research or analysis to justify initiating a rulemaking.”

The NLRB statement makes no reference to the requested information, nor explains why it is only granting half the extension requested by Sen. Murray and Rep. Scott and refusing their request to schedule public hearings.

In response to a query as to whether the NLRB sent Sen. Murray and Rep. Scott the information requested, the NLRB responded in a statement, “Yes, the chairman did reply to Senator Murray and Representative Scott. The Board voted to grant a 30-day extension for comments on the joint-employer rulemaking and against holding public hearings.”

Sen. Murray said in a statement to Business Insurance: “Unfortunately, it appears that (NLRB) Chairman (John F.) Ring was not serious when he told senators he wanted to make sure the Board heard from people who cannot afford to hire a law firm to advocate on their behalf.

“Even more concerning, its refusal to hold public hearings makes it even more clear that the Trump Board isn’t interested in the full participation of the public as it seeks to jam through this anti-worker rule.”

But others say the issue has been on the forefront for a long period, and opponents to the rule have already had adequate time to express their opinions on the issue.

“I will say in (the NLRB’s) defense it may be simply they’ve had a fair amount of open discussion on this dating back years since this doctrine was first overturned by the NLRB,” said Steven M. Bernstein, a Tampa, Florida-based partner with Fisher & Phillips LLP and a labor lawyer who represents employers.

“This pingpong ball that has bounced back and forth on the issue has been frustrating for everyone,” he added, because it makes it difficult for firms to engage in strategic planning.

He said he suspects that out of the rule-making process, “more granular” guidance will emerge “that helps stakeholders comply with the regulation day to day.”

“The constituents have had the chance to express themselves on multiple occasions over the past two years, and I think the record is pretty well developed,” said Mark G. Kisicki, a partner with Ogletree, Deakins, Nash, Smoak & Stewart P.C. in Phoenix, who represented Browning-Ferris.

“Constituents don’t need months and months of time to re-corral those arguments and present them to the board because that’s mostly what we’re going to be seeing,” Mr. Kisicki said. “And the reality is, the board is simply talking about going back to a standard that existed for decades.”

Former NLRB Chairman Philip Miscimarra, a Republican who now leads Morgan, Lewis & Bockius LLP’s special appeals practice in Washington, said, “The agency is responsible for evaluating the particular procedures it deems appropriate, so from that perspective, I think the agency is in the best position to evaluate the scope of the matters being addressed and the path that is most appropriate and helpful for the development of regulations.”

He said that in 2014, after a year of consideration, the agency issued a final rule on union election procedures that was “extraordinarily complex” and resulted in a final rule that is 735 pages long.

In contrast, the proposed joint-employer rule “deals with an extremely discrete issue, and the proposed rule itself, including the explanatory material, consist of 60 pages,” he said.

“I think the board could appropriately decide the issue” based on the input it has received in the form of comments responding to the notice of proposed rule-making, he said.

Experts say they anticipate the rule will essentially be approved as proposed.

“That seems to be the direction, but we won’t know” until the final rule is issued, said Mr. Przybylski. He said early next spring “is probably the earliest” this can be expected.