House Committee Passes Joint Employer Correction

Employment Law

This week, the House Committee on Education and the Workforce approved an HR Policy-supported bill that clarifies the definition of who is a "joint employer" under the Fair Labor Standards Act and the National Labor Relations Act.  The Save Local Business Act (H.R. 3441), which passed the Committee on a party-line vote, would reverse the NLRB's controversial decision in Browning-Ferris, expanding joint employer liability to include situations where one company has the "potential" to influence the employment conditions of a separate company.  The bill also creates a uniform definition of joint employer under the FLSA (Circuit Courts have various standards), and provides certainty and stability for workers and employers by requiring that a company exert "direct, actual and immediate" control of workers to be their employer.  The Committee also passed an amendment to clear up concerns raised at a September hearing that the bill would allow companies to commingle their businesses in such a way as to allow them to escape liability.  Lead sponsor of the bill, Rep. Bradley Byrne (R-AL), said: "H.R. 3441 simply restores the commonsense joint employer standard that workers and employers relied on for decades."  The legislation, which has 95 cosponsors in the House, including three Democrats, could be brought up this fall for House floor consideration.