The legislation is considered an NFIB Key Vote for the 118th Congress
The U.S. House of Representatives passed legislation disapproving the harmful new joint employer rule. The legislation is considered an NFIB Key Vote for the 118th Congress. NFIB opposes the new joint employer rule the National Labor Relations Board (NLRB) came out with in October 2023 which will rescind and replace the previous standard enacted in 2020.
“Small business owners succeed when there are clear and consistent guidelines,” said Adam Temple, NFIB Senior Vice President of Advocacy. “The new joint employer rule brings one more burdensome regulatory change that is complicated for small businesses to navigate in conjunction with ongoing economic challenges.”
The Board’s new standard significantly expands when employers are deemed a joint employer under the National Labor Relations Act, which is why the legislation disapproving the rule is crucial for small businesses.
“The arbitrary standards outlined in this rule will make compliance a nightmare for small business owners who do not have the teams of lawyers, accountants, and compliance staff needed to navigate these vague and subjective definitions,” said Elizabeth Milito, Executive Director of the NFIB Small Business Legal Center. “Also concerning is that the rule expressly declined to exempt franchises and small businesses. Independent franchisees may lose control over their workforce under the new standard.”
Previously, NFIB supported the 2020 joint employer rule that simplified the determination of joint employer status. The new complicated rule makes it more difficult for small businesses to know the requirements for compliance, putting them at risk for penalties.
“NFIB is also concerned that the new standard will have unintended consequences for small businesses outside of the franchise model and may subject employers to new liabilities if third parties ‘deemed joint employers’ violate labor laws,” said Temple. “We thank the U.S. House for passing this legislation disapproving the new joint employer rule.”
The NFIB Small Business Legal Center protects the rights of small business owners in the nation’s courts. NFIB is currently active in more than 40 cases in federal and state courts across the country and in the U.S. Supreme Court.