Today the National Labor Relations Board (NLRB) announced it is considering a new rulemaking to fix the controversial joint employer standard. Competitive Enterprise Institute labor policy expert Trey Kovacs praised the move:
For American businesses and workers, today’s move by the National Labor Relations Board to address regulatory uncertainty associated with the joint-employer standard is welcome news. The NLRB’s announcement of a new joint employer rulemaking is a better, less politicized way than adjudication to deal with labor policies that impact businesses and jobs across the nation.
Though the NLRB historically relied on case by case dispute adjudication to set policy precedents, nothing prohibits the agency from issuing rules like any other regulatory agency. Rulemaking provides clear benefits that adjudication does not offer. For instance, the regulated community would receive advance notice of potential policy changes and have the opportunity to comment on the policy prior to implementation. A rulemaking is more likely to avoid the pitfalls of the controversial NLRB Browning-Ferris decision, which created an overly vague definition of a joint employer and failed to consider all the ways businesses could become ensnared in huge liability that comes with being suddenly deemed a joint employer.
Kovacs has been a longtime critic of the Obama-era NLRB ruling that increased employer liability for countless businesses and thereby jeopardized jobs.