Small businesses are seeing the scales tipped against them
Washington, DC (August 29, 2016) – As the nation marks Labor Day next week, there will be lots of
discussion about the battle between labor and corporations. What is often
forgotten, is how small businesses are affected by rules and regulations
created to go after big companies. Small business owners with limited resources
often become the target of labor organizers. In recent years, the Department of
Labor (DOL) and National Labor Relations Board (NRLB) have been making major
changes to long-standing regulations, tipping the scales in favor of
“For a small business owner, labor law is a
confusing minefield where one misstep can mean civil or even criminal
penalties,” said NFIB Vice President of Public
Policy Amanda Austin. “These owners are often the head of human resources
and the chief compliance officer for their small firm. They lack the time or
the resources to confront the challenges posed by unions and government
Below are a few examples of recent government
actions tipping the scales against small business owners.
Persuader Rule – The DOL recently changed rules regarding disclosure for those
involved in supporting a business during a union organizing campaign. Under
long-standing previous rules, lawyers who merely provided legal advice to a
business owner were not required to file as a persuader since they did not have
direct contact with employees. Now, the DOL wants to require this disclosure,
which may even require attorneys to breach attorney-client privilege.
Currently, NFIB has won an injunction in
federal court barring implementation of the new rule. Further proceedings in
the case will be held this fall. For more, see this February op-ed from Karen
Harned in the Daily Caller.
Walk Around Rule – A controversial memo from a DOL official has opened a new avenue for
union organizers to target small businesses. The so-called “Union Walk Around”
rule allows for an organizer to accompany an official from the Occupational
Health and Safety Administration during an inspection even if the union does
not represent any workers at the company.
The NFIB Small Business Legal Center is
currently exploring legal options to reverse this ruling. For more on this
union tactic, see this Fox News appearance by an NFIB member targeted in
Overtime – The DOL just recently changed the threshold for employees who are
eligible for overtime pay. The threshold was more than doubled, possibly
affecting up to 44 percent of small businesses nationwide. Few small businesses
have the resources to dramatically increase employee pay, as the DOL assumes
will happen. Instead, these businesses may have to move previously salaried
employees to hourly wages or cut benefits.