NLRB Ruled: McDonald’s Not a Joint Employer
“McDonald's should not be held responsible for the labor practices of its franchisees, the National Labor Relations Board ruled on Thursday. ...The federal agency, in charge of enforcing U.S. labor law, delivered the latest ruling in a years-long union case that sought to hold the fast food chain liable for the treatment of all workers at both corporate and franchise locations. The agency, also known as NLRB, directed a federal administrative law judge to approve a settlement that had earlier been reached between McDonald's, its franchisees and the workers who had alleged labor-law violations.”
“The government's labor-law prosecutor at the time asked the judge, Lauren Esposito, to review the complaints and consider McDonald's a ‘joint employer’ of franchisees accused of violating labor laws. ...The SEIU and the Fight For $15 on Thursday called the board's ruling on the McDonald's case illegitimate, saying they would ‘forcefully’ appeal ... McDonald's welcomed the NLRB's ruling...”
“Worker advocacy groups have long argued that many companies use contracting and franchising as a shield from responsibility for workers who make their business possible. In multiple lawsuits, unions and groups have pushed for McDonald's to be designated as a ‘joint employer,’ which would also help the efforts to organize workers and bargain for higher wages. McDonald's has fought against the joint-employer designation because it would have ‘a major impact on their business... Separately, the NLRB is expected to undo an Obama-era policy that made companies jointly liable for labor violations by their contractors and franchisees. NLRB proposed the rollback in September 2018, and the agency's spokesman said the final rule is expected in 2020.”
NPR, December 12, 2019: “McDonald's Not Responsible For How Franchisees Treat Workers, U.S. Agency Rules,” by Alina Selyukh
Politico, December 13, 2019: “McDonald's notches NLRB victory,” by Rebecca Rainey
CNN, December 13, 2019: “Labor Board sides with McDonald's in landmark case,” by Danielle Wiener-Bronner
NLRB, “McDonald's USA, LLC, a joint employer, et al.” (Docket Activity)
NLRB, “ McDonald's USA, LLC: Amended Board Decision” (39 pages, PDF)
NLRB, December 12, 2019: “Board Approves McDonald's Settlement”
Joint employer
The Labor Department and the National Labor Relations Board were each expected to release, in December, regulations that establish (under the Fair Labor Standards Act and the National Labor Relations Act, respectively) when to classify a business a "joint employer," jointly liable for labor violations committed by its contractors and franchisees. But that deadline may slip into January. DOL's version is being reviewed by the White House budget office.”
Politico Morning Shift: Regulatory Corner, December 20, 2019: “REGULATORY CHECKLIST: Federal labor agencies have several significant employment-related regulations to get out the door in the next 11 days or early in the new year”
Reuters, WestLaw News, January 7, 2020: “Fight for $15 says ethics conflict warrants fresh look at NLRB McDonald's case”
