2023-11-13 15:43:05
A new federal rule in the United States that might make it easier to create unions at large companies like McDonald’s will go into effect next month, but it is already causing resistance among companies and even lawmakers.
The rule—announced last month by the National Labor Relations Board (NLRB)—establishes new standards for determining when two companies should be considered “joint employers” under the National Labor Relations Act.
The rule essentially expands the number of companies that would have to participate in labor negotiations along with their franchisees or independent contractors. For example, it might force Burger King to negotiate with its employees even though most of those locations are franchises. Or it might force Amazon to negotiate with delivery drivers who are employees of independent contractors.
The law “tries to adapt to today’s reality, when many companies outsource hiring and when there is a problem they say ‘Well, I’m not the employer,’” explained Cathy Creighton, director of the Buffalo Co-Lab at the School of Labor Relations. and Industrials at Cornell University. “The employer is the one who makes the decisions and the one who has the money.”
The NLRB notes that the new rule modifies a 2020 rule that made it too easy for joint employers to evade responsibilities when it comes to negotiations with their workers. National Labor Relations Act, passed 88 years ago, guarantees the right of all workers in the United States to form unions.
But critics say it is an overreach by the administration of pro-union President Joe Biden and that it hurts independent business owners. Some business owners — including the American Hotel Association — have already filed lawsuits to block the rule.
“The franchise model is a great American innovation. “It has created wealth for many, particularly women or ethnic minorities who are not well represented in entrepreneurship,” McDonald CEO Chris Kempczinski said at a recent conference with investors. “This is something that, we believe, should be supported, not attacked.”
Sens. Joe Manchin, D-West Virginia, and Bill Cassidy, R-Louisiana, have introduced a resolution to repeal the rule. The resolution would have to be approved by both houses of Congress and signed by President Biden.
Biden has not said whether he supports the new rule, but has presented himself as the most pro-union president in American history. The rule must come into force on December 26.
Richard Eiker, 54, has worked in the fast food industry for 25 years and now works for a McDonald’s restaurant in Kansas City, Missouri. He claims that his company clearly controls his franchise and is evading his responsibilities to employees.
Eiker, one of the leaders of the pro-union group Stand Up KC, said unionization will result in better pay, better benefits and better working conditions. Eiker suffers from foot pain and high blood pressure, but says his job does not offer him health insurance or paid time to go to a doctor’s appointment. He often takes half a pill because he can’t afford more.
“McDonald’s made almost $15 billion in profits in the last two years. They can certainly afford to treat us better, and with a union we might get them to do the right thing,” he said.
The new joint employer rule had its origins in the Barack Obama administration. In 2015, the NLRB ruled that Browning-Ferris Industries, a waste management company, should be considered the joint employer of contract workers sorting its recycling because it had authority over their working conditions. A federal court upheld the NLRB’s decision in 2018.
But under Donald Trump, the Republican-controlled labor board narrowed the definition of a joint employer. Under the 2020 rule, companies might be considered joint employers only if they have “substantial, direct and immediate control” over working conditions.
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