Congress is responding to the multifamily industry’s opposition to a recent National Labor Relations Board (NLRB) decision to expand the definition of a joint employer. In just the last two weeks, key Senate and House Committees have both held hearings on the related negative consequences that employers could face in relationship to their business operations. As we reported, the decision could have a significant impact on multifamily firms who may become liable for the actions of subcontractors, suppliers, vendors and temporary staff.
NMHC/NAA have joined an industry coalition in urging strong support for the “Protecting Local Business Opportunity Act,” focused on overturning the ruling. The bill was introduced by Senator Lamar Alexander (R-TN) and Representative John Kline (R-MN) who chair the Senate and House committees that held the recent hearings.
The NLRB ruling would require joint employers to negotiate with any union representing the jointly employed workers and share liability for National Labor Relations Act violations.The ruling resulted from the Browning-Ferris Industries case, where the NLRB decided that it could impose joint employer liability when an entity has “indirect” control and “unexercised potential” of control over another entity’s employees.
However, for 30 years before this ruling entities were designated joint employers when both had “direct and immediate” control over “essential terms and conditions of employment.” According to two labor board members who dissented, the ruling will “subject countless entities to unprecedented new joint-bargaining obligations that most do not even know they have.”