NLRB Won’t Outsource ‘Substantive’ Work on Joint Employer Rule (1)

The National Labor Relations Board will outsource some document processing tasks as it reviews public feedback on a controversial rule to limit liability for businesses using contract workers. But the board’s chairman says substantive review of stakeholder’s comments will be handled in-house.

Chairman John Ring (R) told House Democrats March 22 that NLRB employees will review the nearly 30,000 public comments on the board’s proposal to limit “joint employer” liability for businesses in franchise, staffing, and other contractual relationships. The agency will, however, hire “temporary support on a limited, short-term basis to perform the initial sorting and coding” of the comments, Ring said in a letter to Congress.

Outsourcing that component will allow agency employees to focus on the substantive work of reviewing and responding to comments, which the board must do before finalizing the new rule, the chairman said.

Limiting contractors’ role in that manner will likely quell some of the concerns that have been raised by congressional Democrats and some board employees—federal administrative laws bar private parties from participating in some aspects of a governmental rulemaking, but this sort of initial review is likely permissible in certain circumstances.

The details of the plan are unlikely to appease the agency career staff, though, whose representatives have said it’s “particularly galling” that agency leadership would use the NLRB’s “limited funds” to hire contractors despite having in-house expertise.

Ring noted in his letter to Congress that the board hasn’t received any negative reaction from agency staff, and he repeated the statement when asked for comment by Bloomberg Law.

Adamn Naill, an attorney and staff representative at agency headquarters in Washington, D.C., told Bloomberg Law March 22 that employees “were and are very upset about it,” but haven’t relayed their opinions to agency leadership “for a variety of reasons.”

Detailed Response Forthcoming

The joint employment issue is at the center of a major case involving McDonald’s currently pending before the board. Workers at McDonald’s franchise restaurants who were fired for participating in Fight for $15 rallies argue the company is their joint employer along with individual franchise owners. The issue was also highlighted by unfair labor practice allegations against Microsoft by software testers hired by a staffing firm.

Reps. Bobby Scott (D-Va.) and Frederica Wilson (D-Fla.) voiced concerns after word spread that Ring in a February staff meeting said the NLRB would hire contractors to work on the rule, which would restrict the situations in which companies are liable for labor violations against workers that are formally on their subcontractors’ or franchisees’ payrolls.

They criticized the decision, saying the agency “risks further fueling public concerns that it is tainting the rulemaking with conflicts of interest,” especially if comment review work goes to a business with an interest in the eventual final rule.

A significant proportion of the public comments that agencies often receive on proposed rules are duplicative, and others aren’t germane to the proposal. Ring said the agency’s “own labor-law professionals will perform the first substantive review of the comments” after sorting and coding by contractors.

Staff in Scott and Wilson’s office didn’t immediately respond to a request for comment.