Federal judge in Texas blocks US labor board rule that would make it easier for workers to unionize
A federal judge in Texas has blocked a new National Labor Relations Board rule that would have made it easier for millions of workers to form unions at major companies.
The rule, which was set to take effect Monday, would have set new standards for determining when two companies should be considered “joint employers” in labor negotiations.
Under the current NLRB rule, which was adopted by a Republican-dominated board in 2020, a company like McDonald’s is not considered a joint employer of most of its employees since they are directly employed by franchisees.
The new rule would have expanded that definition to say that companies can be considered joint employers if they have the ability to control – directly or indirectly – at least one term of employment. Terms include wages and benefits, hours and scheduling, assignment of duties, work rules, and hiring.
The NLRB argued that a change is necessary because the current rule makes it too easy for companies to avoid their legal responsibility to bargain with employees.
The U.S. Chamber of Commerce and other business groups — including the American Hotel and Lodging Association, the International Franchise Association and the National Retail Federation — sued the NLRB in November in federal court in the Eastern District of Texas to block the rule.
They argued that the new rule would overturn years of precedent and could make companies liable for workers they don’t employ in workplaces they don’t own.
In his Friday decision seeking summary judgment from the plaintiffs, U.S. District Court Judge J. Campbell Barker concluded that the NLRB’s new rule would be “contrary to law” and that it was “arbitrary and capricious” with respect to to the way it would be applied. change the existing rule.
Barker found that by establishing a set of new conditions to be used to determine whether a business meets the joint employer standard, the NRLB’s new rule exceeds “the bounds of common law.”
The NRLB is reviewing the court’s decision and considering next steps in the case, the agency said in a statement Saturday.
“The district court’s decision to vacate the Board’s rule is a disappointing setback, but is not the last word on our efforts to return our joint employer standard to the common law principles espoused by other courts,” said Lauren McFerran, the presiding judge. NLRB Chairman.