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NLRB Dodging Questions on ‘Joint Employer’ Rule, Democrats Say

Oct. 29, 2018, 8:23 PM

The National Labor Relations Board isn’t providing the details Democrats want about its decision to change current regulations about when multiple companies share joint liability for labor law violations.

The dispute could affect the timing of the ongoing rulemaking on “joint employer” liability, an issue that’s been at the center of debate over labor policy and NLRB ethics restrictions. More importantly, Congress’s oversight and subpoena power over agencies means the controversial rulemaking process could become even more combative if labor committees in the House or Senate flip to Democratic majorities.

Congressional Democrats asked the NLRB for detailed case information to get at the impact of the board’s 2015 legal test for when companies jointly employ workers for collective bargaining and labor violations purposes. The NLRB responded by providing a list of cases that included the phrase “joint-employer.”

A Democratic aide for the House labor panel told Bloomberg Law the board’s letter answering the inquiry from Sen. Patty Murray (D-Wash.) and Rep. Bobby Scott (D-Va.) is “non-responsive.”

The NLRB didn’t respond to a request for comment.

Both the NLRB chairman and the larger business community have criticized the standard established by President Barack Obama’s NLRB, saying it undermines job creation because it increases risk for franchises, contractors, and other similar businesses. The business community has also argued that the current standard unfairly forces parent companies to the union negotiating table along with their subsidiaries, even when those larger businesses lack control over the workers involved.

Worker advocates maintain that the policy is necessary to protect employees’ rights in an economy where temporary and contracted work is increasingly prevalent.

Looking for Clarity on Impact

Democrats asked for data that would show, for example, how many groups of workers have tried to form a union under the 2015 joint employment standard; cases where two businesses and a group of workers agreed that the companies were joint employers; and cases where the question of joint employment was disputed and then resolved by agency officials. The information is meant to gauge whether fears that the Obama-era standard would result in a big spike in labor litigation against franchises and other similar businesses were warranted

The NLRB responded to those separate queries last week by providing a list of cases that include the phrase “joint-employer” in the case files. “They have access to all the filings in all these cases [but] they seem remarkably incurious to know which of these cases involves a dispute over whether someone’s a joint employer,” a Democratic aide said.

Trey Kovacs, a labor policy analyst at the conservative Competitive Enterprise Institute, told Bloomberg Law that the list of cases the NLRB provided “seems fairly responsive” to the Democratic lawmakers’ request.

“I can only imagine that the NLRB would say, ‘It’s all on our website, so you find it,’” said Kovacs, who criticized the agency for not responding more fully to his group’s Freedom of Information Act request earlier this year. “In that context, it seems like the NLRB made a good faith effort to find what they asked for.”

As the minority party, the Democrats’ bid for more information doesn’t carry legal force, practically, but that could soon change depending on the outcome of the next week’s midterm elections. Some political handicappers have predicted that the Democrats have a strong chance at taking control of the House, potentially opening up the NLRB to a wave of oversight hearings and congressional inquiries backed by subpoena power.

Less Transparent Than in Previous Years?

The NLRB and Democratic lawmakers have been sparring for months over ethics issues at the board as well as its plan to remake its joint employment standard via rulemaking. The two issues have a connection: Due to a conflict-of-interest problem with a Republican board member, the NRLB was forced to rescind its December 2017 decision overturning a 2015 ruling that set the current joint employment test.

The NLRB in September proposed a new regulation to redefine joint employment. Under that proposal, one company would have to exert direct and immediate control over another’s workers to be considered a joint employer. That would largely restore the legal test in place before the Obama board changed it to consider indirect and unexercised control.

Sen. Murray of Washington and Rep. Scott of Virginia, the highest-ranking Democrats on the Senate and House labor committees, asked the NLRB earlier this month to provide more justification for its joint employer proposal.

The lawmakers included 17 questions seeking case information for the time period between the Obama board’s 2015 joint employment ruling and the board’s failed attempt to overturn it in 2017, as well as case information for an equal period of time preceding the 2015 decision.

NLRB Chairman John Ring responded last week that the agency’s internal case management system, known as NxGen, has limitations on how cases can be searched. For example, the system doesn’t have a specific field that identifies whether a party made a joint employer allegation, Ring said.

But the NLRB’s decision to respond to the Democrats’ inquires with long lists of cases deviates from past precedent, according to Celine McNicholas, who headed the agency’s office of congressional and public affairs during the Obama administration.

“We responded as thoroughly as we possibly could regardless of whether the request came from the majority or minority party,” McNicholas, director of labor law and policy at the left-leaning Economic Policy Institute, told Bloomberg Law.

Although the case fields may not be readily searchable in the agency’s system, staffers could have taken a deeper dive into cases to provide lists that were more responsive to the Democrats’ questions, McNicholas said.

To contact the reporter on this story: Hassan A. Kanu in Washington at; : Robert Iafolla in Washington at

To contact the editors responsible for this story: Chris Opfer at; Simon Nadel at