Who’s the boss? The National Labor Relations Board recently muddled that normally straightforward question. In August, the NLRB, in the case of Browning-Ferris Industries, unilaterally redefined the concept of joint employment.
Under its new definition, companies may be held liable for labor violations committed by other employers with whom they contract — even if they do not exercise direct control over that company’s employees.
Now the NLRB is looking to take on a big-name employer, McDonald’s.
But this will hurt small businesses. Worse, the NLRB is trying to keep the public in the dark about what it’s doing.
Most contractors, franchisees and staffing agencies are small businesses that partner with other businesses, large and small. Holding them responsible for the employees of other businesses with which they contract threatens to stifle these beneficial business linkages, which are responsible for 60% of all new jobs.
Still, the NLRB is moving forward with a case targeting several McDonald’s franchises, as well as the parent company.
Last year, NLRB General Counsel Richard Griffin consolidated dozens of unfair labor practice charges against McDonald’s franchisees and named McDonald’s USA LLC as a joint employer responsible for alleged labor-law violations of privately owned franchises all across the country. The case had stalled because the NLRB has asked for multiple continuances.
The NLRB claimed the case has been held up because of a purported lack of transparency from McDonald’s. It complains that McDonald’s has heavily redacted information that it needs to make its case.
In defense, McDonald’s contends the blacked-out information is not relevant to the case or concerns business practices that are proprietary information. In September, the NLRB opposed McDonald’s request to commence the case, but a trial is tentatively set to start Jan. 11. It’s about time.
McDonald’s has produced over 100,000 pages of documents and calls the NLRB’s discovery requests excessive. McDonald’s has gone out of its way to supply the NLRB with the information it will need to question witnesses, build its case and begin the hearing.
But that’s not enough for the agency, which seeks a federal court order to force McDonald’s to hand over the redacted information.
Moreover, as the company’s attorneys note in a motion to stop the delays in its case, “pretrial discovery in Board proceedings is neither constitutionally nor statutorily required.”
Despite the NLRB’s calls for greater transparency from McDonald’s, the NLRB has displayed an utter lack of transparency throughout this process.
When the NLRB first consolidated the unfair labor practice charges and named McDonald’s as a joint employer, its general counsel did not even provide facts or a legal basis for why McDonald’s is considered jointly liable for its franchisees’ infractions.
Sadly, this lack of transparency is par for the course for Obama’s NLRB. In an August memo, NLRB’s Griffin ordered regional offices to “no longer make Agency documents available to the public, such as by maintaining charges and petitions in binders available for viewing in Regional offices.” For decades the NLRB had made this information public, until now.
That’s not all. In 2014, the NLRB used over 1,000 exemptions in order to deny Freedom of Information Act requests.
Many exemptions involved supposedly privileged communications within or between agencies, which is eerily similar to the kind of information the NLRB seeks from McDonald’s. Other exemptions include information that would invade an individual’s personal privacy.
That’s rich coming from the same agency that recently implemented an “ambush election” rule that requires employers to hand over employees’ private information — including telephone numbers and email addresses — to union organizers, without any opportunity for employees to opt out of sharing that information.
In a rare moment of clarity on why the NLRB is going after McDonald’s, NLRB General Counsel Griffin recently told an American Bar Association forum that the “sole” reason the agency is aggressively pursuing a case against McDonald’s is because of the union-funded “Fight for $15” campaign.
The Obama administration needs to ask itself if paying back union allies is worth destroying thousands of business relationships that create jobs for hardworking men and women.
Franchises alone employ millions of workers and accounted for 10% of new jobs in 2013 and 2014. So instead of badgering employers for irrelevant information, NLRB members should consider how their new joint-employer decision will burden job creators and make it much harder for entrepreneurs start new businesses.
Congress can take a stand against the NLRB’s joint-employer standard, which will wreak havoc on job creators by holding back the funds required to implement it.
Originally posted at Investor's Business Daily.