NMHC/NAA recently urged Congress to oppose burdensome employment rules expanding the definitions of joint employer and mandatory overtime. Specifically, in its August Browning-Ferris Industries ruling, the National Labor Relations Board (NLRB) significantly expanded the definition of a joint employer. This could have a significant impact on multifamily firms who may become liable for the actions of subcontractors, suppliers, vendors and temporary staff. Meanwhile, in June the Department of Labor proposed to increase the salary threshold for white collar workers who are entitled to overtime pay protections under the Fair Labor Standards Act (FLSA). Multifamily and other industry workers would be impacted because overtime pay would be determined based only on falling below the threshold.
In Coalition for a Democratic Workplace letters, the apartment industry urges lawmakers to defund implementation of the NLRB joint employer ruling as part of legislation that must be enacted by December 11 to fund the Federal government for Fiscal Year 2016. A separate Partnership to Protect Workplace Opportunity letter asks Members of Congress to contact the Labor Department to share concerns regarding the agency's proposed overtime rule.
Joint employers occur when the supervision of an employee’s activity is shared between two or more businesses. The NLRB ruled 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.”
Importantly, joint employers are required to negotiate with any union representing the jointly employed workers and share liability for National Labor Relations Act violations.
Under this proposal, the salary threshold for executive, administrative and professional employees’ overtime pay would be raised in 2016 from $455 a week ($23,660 a year) to a projected level of $970 a week ($50,440 a year).
Among other issues, the multifamily industry is concerned the proposed rule would harm the ability of employers to implement, and employees to take advantage of, flexible scheduling options. The rule could also result in employees being treated differently due to regional cost-of-living differences. In addition, it could limit career advancement opportunities for employees.
A final rule is expected in July 2016.