Dive brief:
- Sen. Joseph Manchin, DW.V., crossed the aisle on April 10 to kill the National Labor Relations Board’s joint employer rule.
- Manchin was the only Democrat to join 47 Republicans and two independents in voting against a measure of disapproval of the Congressional Review Act, a legislative tool that gives Congress the authority to overturn specific power regulations executive by a simple majority of votes in both chambers. The House passed the CRA measure in question in January.
- President Joe Biden vowed to veto the measure during the first debates in January. Given the relatively even partisan divide within Congress, opponents of joint employer rule are unlikely to be able to muster the necessary two-thirds majority to override a veto.
Diving knowledge:
In March, a federal judge in Texas struck down the joint employer rule, setting the stage for a court battle over the regulation, which could nullify the impact of a presidential veto.
The joint employer rule would make general contractors liable for subcontractors’ labor violations if the general contractors reserve the authority to control, or indirectly control, various key conditions of employment.
It is similar to, but narrower than, an earlier NLRB joint employer standard in place during the Obama administration, which was overturned by former President Donald Trump’s NLRB.
In March, Associated Builders and Contractors praised the rule that was struck down in court.
“Under the 2023 final rule, contractors would be vulnerable to increased liability and risk, making them less likely to hire subcontractors, most of whom are small businesses,” said Ben Brubeck, ABC vice president of Regulatory, Labor and State Affairs, in a news release. “The rule clearly would have had a detrimental effect on an important segment of the construction industry: small businesses.”
A joint employer solidarity rule, in addition to holding GCs accountable, can make it easier for unions to organize by reducing the legal fragmentation of employment, which is generally seen as an impediment to organizing.
Preserving weak joint employer standards is a political priority for business groups, which lamented that the proposed change lacks clarity, which could expose them to litigation.
