U.S. House Votes to Repeal Labor Board Rule Impacting Contract and Franchise Workers

In a significant move that could reshape the landscape of labour relations in the United States, the Republican-led House of Representatives has voted to repeal a controversial National Labor Relations Board (NLRB) rule. This rule, set to take effect in February, would have significantly expanded the definition of “joint employers” to include many contract and franchise workers, compelling companies to bargain with unions representing these workers. The decision now moving to the Senate has sparked a heated debate between business groups and worker advocates, reflecting the ongoing tussle over labour rights in the country.

The House’s decision, passed with a 206-177 vote, challenges the NLRB’s rule that aimed to redefine the employer-employee relationship for contract and franchise workers. Under this rule, companies could be deemed joint employers even with indirect control over working conditions, thus requiring them to negotiate with unions and be liable for any violations of workers’ rights under federal law.

Representative Virginia Foxx of North Carolina, a Republican and a vocal critic of the policy, described the NLRB’s approach as “anti-freedom, anti-growth,” arguing that it unfairly subjects small businesses to stringent regulation and union influence. In contrast, Democratic Representative Eric Sorensen of Illinois defended the rule, asserting that the opposition’s claims about its impact on small businesses were misleading and emphasized the fundamental issue of employer obligations in bargaining.

The controversy around this rule is not new. The U.S. Chamber of Commerce and other business groups had already filed a lawsuit to prevent its implementation, claiming it oversteps labour laws and could disrupt various industries. Meanwhile, the NLRB defended the rule, asserting it adopts a well-established employment definition and balances worker and business rights. This rule overturns a Trump-era regulation, reverting to a standard similar to one adopted by the board in 2015 during the Obama administration.

The House vote sends a clear message of resistance to expanding labour rights as defined by the NLRB, setting the stage for a further showdown in the Senate and potentially with the White House. With President Joe Biden’s promise to veto the resolution if it passes both houses and the requirement of a two-thirds majority to override such a veto, this contentious labour rule hangs in the balance. This ongoing debate reflects the deep divisions in U.S. labour policy and the complex dynamics between businesses, workers, and government regulation.