07.12.17

At Hearing, Democrats Support Worker Protections to Hold Employers Accountable

WASHINGTON – TODAY, the Education and the Workforce Committee held a hearing on worker protections that allow employees to hold multiple entities accountable for wage theft, unfair labor practices or workplace safety violations. Labor and employment laws have long held, where more than one employer controls terms and conditions of employment, an employee may have multiple employers. This is referred to as “joint employment.”

A growing number of Americans are taking contingent work through temporary staffing agencies or contractors—nearly 20 percent of all job growth since the end of the recession in 2009 has been through “temp agencies.” These contingent workers perform work for companies that control their pay, hours, and working conditions, but don’t write their paychecks.

“Research shows that the consequences for workers in our economy’s increasingly outsourced growth sectors are lower wages, fewer benefits and less workplace safety,” said Ranking Member Bobby Scott (VA-03). “Without joint employer standards, contingent workers may have no remedies for unfair labor practices, safety violations, or wage theft.”

At today’s hearing, it was argued that Congress should overturn joint employment standards, including the National Labor Relations Board’s (NLRB) 2015 Browning Ferris Industries (BFI) decision.  In a 3-2 decision, the NLRB returned to its pre-1984 standard for determining joint-employer status. It found that BFI was a joint employer with Leadpoint, the company that supplied employees to BFI to perform various work functions, including cleaning and sorting of recycled products.

In this case, the NLRB found BFI was a joint employer because of the indirect and direct control that BFI exercised and reserved over essential terms and conditions of employment of the workers supplied by Leadpoint.

“The Board’s [Browning Ferris] decision simply stands for the unremarkable position that when companies like BFI decide to outsource portions of their workforce to staffing companies or other labor subcontractors, yet still retain control over the work, they remain accountable, along with their contractors, for labor protections,” said Cathy Ruckelshaus, General Counsel of the National Employment Law Project (NELP), who testified at today’s hearing.

Narrowing the joint employment standard under the NLRA creates a legal loophole that would let client employers dictate wages and working conditions for the employees of staffing agencies, but avoid joining these workers at the bargaining table. Democrats challenged unfounded arguments that Browning Ferris undermines the independence of franchisees, pointing out that narrowing the standard for a joint employer would empower the franchisors at the expense of franchisees.

“I hear the cries that BFI and the McDonald’s litigation have produced anxiety about the elimination of franchises. But any such anxiety has been generated by lobbyists and lawyers looking for fees, not by any actual contraction of franchises,” said Michael C. Harper, Professor of Law at Boston University School of Law, during his testimony. According to Harper, passing legislation that narrows the definition of a joint employer, “probably would result in franchisors, and other economically dominant businesses, exerting greater, not lesser, control over franchisees and subcontractors.”

FULL OPENING STATEMENT: Ranking Member Bobby Scott (VA-03)

FULL TESTIMONY: Ms. Catherine Ruckelshaus, National Employment Law Project

FULL TESTIMONY: Mr. Michael Harper, Boston University School of Law

Press Contact

Contact: Arika Trim,202-226-0853 (Scott)