PUNCHING IN: What a Week for the Labor Board


Monday morning musings for workplace watchers 

By Chris Opfer and Ben Penn


Getting to the Joint | Et Tu Acosta? | This Guy Can Blame McConnell for Being Jobless 

Chris Opfer: It’s safe to say the labor board didn’t get an early start on its holiday vacation. NLRB Chairman Phil Miscimarra (R) in his last week on the job went out like Clark Griswold on a super-waxed Christmas sled, leaving a trail of overturned Obama era decisions in his wake. The controversial Browning-Ferris joint employment test is now a thing of the past, along with the Obama board’s worker-friendly approach to determining whether neutral employment policies run afoul of federal labor law. And then there’s organizing for “micro units” of employees within a larger workforce. You can chuck that one in the trash along with the netty pot you pulled from the office holiday gift exchange.

We’re still sorting out what the joint employment decision means for the Browning-Ferris appeal pending in D.C. and for ongoing litigation against McDonald’s. As far as we know, the NLRB is still litigating unfair labor practice complaints against the golden arches, arguing that McDonald’s is a joint employer of workers at franchisee restaurants. In Browning-Ferris, the NLRB will likely alert the appeals court that the board has changed its mind on the issue. Whether that influences the court remains to be seen. 

Meanwhile, Littler Mendelson’s Michael Lotito says the McDonald’s situation is “very interesting” because the complaints argue that the fast food giant is a joint employer with its franchisees under both the Browning-Ferris indirect control test and the new/old direct control standard set by the board last week.

“The general counsel has an interesting opportunity, since that hearing has not closed, to go to the judge and say all of this evidence on indirect control doesn’t really matter anymore,” Lotito told me.

One other question: Is this really the last word for Miscimarra? The chairman wrapped up his term over the weekend, but we’re told there may be more decisions that he signed off on before leaving, which could trickle out in the coming days.

Ben Penn: Chris, you predicted a week ago that the NLRB would “try to churn out a ton of decisions.” Time for Punching In to take a Vegas Vacation for the holidays.

The board taking an axe to the Obama-era joint employer standard still leaves me wondering how the Labor Department will interpret employers’ joint liability for minimum wage and overtime violations

Sure, Labor Secretary Alex Acosta last June withdrew a David Weil memo that sought to clarify a broad definition of the term under the Fair Labor Standards Act. But Acosta grounded his justification for that move in adherence to administrative law, arguing the guidance documents were regulations in disguise. Acosta has mostly avoided a policy discussion on the merits of holding corporations accountable for affiliated entities’ workplace conditions. And DOL’s Wage and Hour Division hasn’t prescribed new enforcement procedures on the matter. 

The secretary may be leaving that call up to his choice for wage chief – Cheryl Stanton – whose nomination is collecting dust in the Senate but expected to go forward. In the meantime, the DOL’s regional and district attorneys, joined by 1,000 or so WHD investigators scattered around the country, have some discretion to go after purported joint employers. 

That’s where things could get interesting.

It may take Stanton, solicitor-in-waiting Kate O’Scannlain, and Acosta a long time to craft new guidance or rulemaking on this issue, if they address it at all. But for now we could get a strong clue about where the department intends to go by tracing an investigation up to the solicitor’s office in Washington. 

Let’s say a local WHD investigator in Oklahoma attempts to tag a fast-food company as jointly liable for a franchisee’s alleged nonpayment of overtime. The corporations says it doesn’t share responsibility, and refuses to settle. This kicks the case over to the regional office, which opts to litigate. Enter the politically appointed DOL solicitor at headquarters.

“Ultimately the decisionmaker is the solicitor’s office because if the solicitor’s office says we’re not going to file a case, then that’s where it goes to die,” Alex Passantino, acting WHD administrator under George W. Bush, told me. “Then you’re basically just turning it over to private litigation.”

Avoiding such lawsuits is precisely why the International Franchise Association and other business lobbyists will keep pushing for the joint employer bill in Congress. 

CO: This is the time of year when folks like to make lists. Aside from joint employment, here are two topics I plan to keep a close eye on in the New Year: The future of work and cybersecurity on the job.

The Labor Department’s updated gig worker survey, which the DOL is reviving for the first time since 2005, is just around the corner. We can expect worker classification and all the other issues stemming from the sharing economy to get a closer look in Washington when that happens. What I want to know is whether lawmakers and regulators have used the time since Uber and Lyft came onto the scene and artificial intelligence started replacing more humans to wrap their heads around how the workforce is changing. Organizational design consultant Aaron Dignan doesn’t seem to think so.

“I watched a government hearing where a Senator asked what an ad impression is on Facebook, and that scared the shit out of me,” Dignan, founder of management consultant firm The Ready, told me at a future of work event in New York last week. “It means that there’s a fundamental lack of knowledge and comprehension about what’s going on.”

Plenty of people across the political spectrum share Dignan’s take on government’s tech savvy.

Speaking of tech, most of the attention to big data hacks has concerned breaches involving customer info and government data, but I’m more interested in what happens when a company is hacked for its workers’ data? If you have some thoughts on that, you know where to find me.

BP: The Labor Department almost certainly will start 2018 without a deputy labor secretary, solicitor, administrators for WHD and OSHA, and all other Senate-confirmed slots but mine safety head. Capitol Hill reporter Tyrone Richardson says the word in the Senate is that the nominees for DOL, along with a pair of EEOC picks, likely won’t be considered on the floor until after New Year’s, with the tax bill, a continuing resolution to fund the government, and judicial noms taking priority.

Before you say I’m a broken record on these delays, there’s a slight difference this time – the nominee who has waited longer than all others, Pat Pizzella for deputy labor secretary, is now in a state of purgatory. Until this month, Pizzella’s been reporting to work as acting chairman of the Federal Labor Relations Authority, providing a distraction from the anxiety of waiting to hear Mitch call his name. No more.

Pizzella’s last day at the office was Dec. 8, ending a four-year run as a member of the agency that rules on federal employee labor-management disputes. This means the longtime government official has extra time to bone up for what we still assume will be a gig as the DOL’s No. 2 official, eventually. 

Reflecting on the past six months since the White House first nominated Pizzella for the post, I can’t help but notice that the delay is intertwined with the massive NLRB precedent reversals that may continue to trickle out this week. With such compressed space on the legislative calendar for GOP leadership to find time to debate nominees, two Trump-appointed NLRB members – and the board’s general counsel – were still voted on and confirmed in recent months. 

The decisions to overturn BFI, Lutheran Heritage, and Specialty Healthcare were only possible because the GOP-controlled Senate deemed the NLRB vacancies now filled by Bill Emanuel and Marvin Kaplan to be more crucial than many other vital openings throughout the government. 

I’d imagine the majority of Americans don’t know the consequences, or even the existence, of the labor board’s 3-2 Republican majority. Mitch McConnell certainly did, though, and businesses are rejoicing this week because of it.

CO: Also, the Labor Advisory Committee on trade postponed its meeting with Secretary Acosta and U.S. Trade Representative Robert Lighthizer that was supposed to take place last week. Michael Wessel – liaison to the LAC Chairman, Leo Gerard – tells Ben there was a travel conflict that held up the big convening of union presidents, and that both sides are eager to reschedule.

We're punching out. Daily Labor Report subscribers can check in during the week for updates. Tyrone Richardson will be watching when Betsy DeVos chats with the House Education and the Workforce Committee to see what the education secretary might have to say about apprenticeships and job training. Jon Steingart tells us briefs are due in the latest edition of the debate over whether Apple store employees should be paid for time spent in security screenings. Martin Berman-Gorvine is looking at how Silicon Valley is handling California’s pay history ban. 

In the meantime, feel free to reach out to us:  copfer@bna.com and bpenn@bna.com, or on Twitter: @ChrisOpfer and @BenjaminPenn.

Happy holidays. See you back here next week.

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