McDonald’s Beefs Up Lobbying Democrats on Joint-Employer Issue

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By Tyrone Richardson

McDonald’s Corp. is hiring lobbyists with Democratic ties as part of an industry push to convince lawmakers to reject the NLRB’s definition of joint employment and thus shield franchisers from having to collectively bargain with franchisee workers.

The Oak Brook, Ill.-based fast-food company has tapped firms Brownstein Hyatt Farber Schreck; Manatt, Phelps & Phillips; and theGROUP DC to lobby Congress on the issue.

McDonald’s and other fast-food industry players like Yum! Brands and the International Franchise Association want Congress to pass legislation to limit liability under federal labor law for businesses that use staffing, franchise, and other contract relationships.

They’re taking aim in particular at a 2015 National Labor Relations Board decision that could require franchisers as “joint employers” to collectively bargain with franchisee workers.

“Providing certainty to small businesses should be a goal of all elected officials, regardless of political affiliation” Matt Haller, the IFA’s senior vice president for communications and public affairs, told Bloomberg BNA in a May 22 email.

“The fact is that the joint employer situation that started at the NLRB has gotten more complex in the last two years, expanding into many other statutes at both the federal and state level,” Haller said. “All business-to-business relationships are now confronting the tangled web of potential joint employer law.”

Congressional Democrats have largely supported the joint employer decision, saying that it gives workers a real voice at the bargaining table. McDonald’s and other critics are hoping to convince at least some Democrats that are on the fence on joint employment that the NLRB went too far.

Using Democrats to target Democrats isn’t a new strategy, said Gregory Wawro, a political science professor at Columbia University.

“Republicans are already in favor of what corporations want, so basically you are looking for people to convince Democrats to join them, and the ones to do that are those who are Democratic lobbyists,” Wawro told Bloomberg BNA.

In addition to joint-employment, McDonald’s has been dealing with other labor-related issues, such as the group Fight for $15 seeking to raise the minimum wages of its restaurant workers.

Companies Seek to Nullify NLRB Ruling

A wide range of businesses is aggressively seeking to reverse the NLRB’s decision in Browning-Ferris Industries of California Inc.

Yum! Brands, owner of fast-food chains Taco Bell, KFC, and Pizza Hut, in 2016 tapped a team of lobbyists at Bockorny Group Inc., which included some former Democratic congressional aides. The lobbyists were tasked with “issues related to joint-employer status,” according to congressional registration documents.

That was the same year the Republican-backed Protecting Local Business Opportunity Act ( S. 2686, H.R. 3459) was floated. The measure, which would have undone the Browning-Ferris decision, stalled in both chambers.

The board in Browning-Ferris said a business may be deemed a joint employer if it indirectly controls an employment relationship or has reserved the right to do so. Employers said that decision, currently on appeal, created uncertainty for businesses operating in various contractual arrangements, including franchisers.

There have been ongoing efforts to reverse the NLRB’s ruling through methods such as riders in the appropriations for running the federal government, new legislation, and policy changes within the NLRB.

Reversal of the NLRB ruling by legislation would need bipartisan support in the Senate to avoid a filibuster. Republicans are hoping to garner some support from Democrats, especially moderates and those who are up for re-election in 2018.

That’s why it is important to aim lobbying at the specific party members, Wawro said.

“They have already got a personal relationship with those they want to influence,” he said. “They are of that institution and know how it works and that kind of experience can be invaluable for those like McDonald’s who want to change policy in their favor.”

McDonald’s and Yum! Brands didn’t responded to Bloomberg BNA’s request for comment.

Supersized Roster of Democrats

McDonald’s lobbying roster this year added Brownstein Hyatt Farber Schreck LLP’s Brian McKeon, a former senior counsel and legislative aide for former Sen. Barbara Boxer (D- Calif.), and David Reid, a staffer of the Hillary for America 2016 presidential campaign, according to disclosure documents.

The company is also using Manatt, Phelps, and Phillips’ James J. Bonham, a former executive director of the DCCC, chief of staff to the former Rep. Robert T. Matsui (D-Calif.), and spokesman for former Sen. Jeff Bingaman (D-N.M.).

McKeon and Reid are among the firm’s team lobbying for McDonald’s on “issues related to franchisees,” in addition to appropriations. Disclosures show Bonham lobbying on behalf or McDonald’s in regards to tax and labor-related issues described as “human resources.”

McKeon, Reid, and Bonham didn’t respond to Bloomberg BNA’s request for comment.

This adds to the lobbying by Darrel Thompson, a staffer of former Senate Majority Leader Harry Reid (D-Nev.) and before that chief of staff to the Barack Obama for U.S. Senate campaign.

Thompson, head of firm theGROUP DC LLC in December 2015 registered lobbying on behalf or McDonald’s for “Issues related to joint employer determination and labor policy,” according to a lobbying registration form.

McDonald’s has paid theGROUP $350,000 since then, according to quarterly Congressional disclosures reviewed by Bloomberg BNA.

Thompson May 15 e-mailed Bloomberg BNA a written statement saying, “it is our company’s policy to not comment on the relationship we have nor the services we provide to any of our public or private clientele.”

It wasn’t immediately known how much McDonald’s has paid for labor-related lobbying to all firms. Some Congressional disclosure filings combine lobbying for labor with other issues such as tax reform, education, and food issues.

To contact the reporter on this story: Tyrone Richardson in Washington at trichardson@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com; Christopher Opfer at copfer@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

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