NLRB: No more dodging labor law with temp agencies and franchise structures


Workers will soon have more power to bargain with all the companies that have a say in their working conditions — not just the company whose name is on their paycheck.

Under a new National Labor Relations Board (NLRB) rule that takes effect Feb. 26, whoever controls a worker’s essential terms of employment — including wages, benefits, and work schedules — is considered an employer and must recognize and bargain with the union representing those workers. The “joint employer” rule is meant to get around shell games some employers have played, in which the entity that really calls the shots, like a franchiser or outsourcer, claims that an employment agency or franchisee is the sole employer.

The new NLRB rule reverses a narrower Trump-era rule that required proof that a company had direct and immediate control of working conditions. That made it easier for some companies to evade their obligation to recognize and bargain with unions.

For example, under the old rule a company could contract workers through a staffing agency instead of hiring them on as company employees. If those workers unionized, only the staffing agency would have to recognize and bargain with the union. And the staffing agency might stonewall the union’s economic proposals by claiming that it couldn’t negotiate pay rates higher than what the company agreed to. With the new rule, the company would be considered a joint employer because it sets the workers’ wages.

“This is a big deal in helping unions really get to the decision makers who they need at the table to make changes for workers,” said Caren Sencer, a labor-side attorney with Weinberg, Roger, & Rosenfeld.

Sencer said the new rule won’t necessarily make every company that uses temporary or subcontracted workers a joint employer. It only applies in cases where two or more employers control the workers’ working conditions. It also only covers unions that organize after the Feb. 26 implementation date, she said.

House GOP doesn’t like it

The change already faces legal and political challenges. In November, a month after the NLRB announced the change, the U.S. Chamber of Commerce and other business groups filed a lawsuit against it. They said the new rule is “as destabilizing as it is unlawful” because it counters the NLRB’s past practices, forces non-union companies to bargain with workers that aren’t theirs, and makes companies liable for labor law violations they did not commit. At press time, no hearing had been set in the lawsuit.

The same month, Republicans in the U.S. House of Representatives introduced House Joint Resolution 98, a bill to nullify the rule. On Jan. 12, House Joint Resolution 98 passed the House 206-177, but it’s unlikely to pass the Senate as long as Democrats are in control, and President Joe Biden vowed to veto it if Congress passes it. The effort in Congress to stop the rule is likely dead, because House Joint Resolution 98 makes use of the Congressional Review Act. That 1996 law allows Congress to strike down a new federal agency rule on a simple majority vote, but gives them only 60 legislative days to do so.


When is an employer an employer? When they get to decide your essential terms of employment. If more than one company has a say in your essential terms of employment, then they’re joint employers, which means they’re jointly responsible for bargaining with a union, and jointly liable for trampling workers rights. As defined by the new NLRB new rule, essential terms of employment are:

  • Wages, benefits, and other compensation
  • Hours of work and scheduling
  • The assignment of duties to be performed
  • The supervision of the performance of duties
  • Work rules and directions governing the matter, means, and methods of the performance of duties and the grounds for discipline
  • The tenure of employment, including hiring and discharge
  • Working conditions related to the safety and health of employees

How Oregon and Washington reps voted on H.J. Res. 98

A yes vote on this resolution would nullify the new joint employer rule. The 206-177 vote was largely on party lines, with just one Republican voting against it, and just six Democrats voting for it.

  • YES  Cliff Bentz (R-Ontario), Lori Chavez-Deremer (R-Happy Valley)
  • NO  Suzanne Bonamici (D-Washington County), Val Hoyle (D- Springfield), Marie Gluesenkamp Perez (D-Vancouver), Andrea Salinas (D-Tigard).
  • ABSENT  Earl Blumenauer (D-Portland)


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