The House of Representatives on Friday passed a bill to overturn the Biden administration’s harmful joint employer rule and defend small business.
The joint employer final rule published by the National Labor Relations Board (NLRB) in October 2023 broadly expanded the traditional understanding of the joint employer standard, increasing liability for businesses and ensuring wide-sweeping economic harm. The new rule asserts that businesses can be held as joint employers on the basis of “indirect control,” or even on the basis of theoretical control which has never been exercised, which is a significant shift from the traditional framework.
When a similarly expansive rule was issued in 2015, studies indicated that franchise businesses could have seen billions of dollars in losses and hundreds of thousands of lost job opportunities for their workers. Moreover, the costs of the new rule, which could be even higher than under the 2015 standard, will pass through to consumers in the form of higher prices
The House took a first step toward combatting this bureaucratic overreach on Friday when it passed H.J. Res. 98, a Congressional Review Act (CRA) resolution introduced by Congressman John James (R-Mich.) which would prevent implementation of the NLRB’s rule. The bill passed on a bipartisan vote of 206-177, with 198 Republicans and eight Democrats voting in favor.
Americans for Tax Reform President Grover Norquist sent a letter to members of Congress last month urging them to sign onto H.J. Res. 98 and its Senate companion, S.J. Res. 49. In November, ATR also led a coalition of more than thirty center-right groups in a letter on the same subject.
Americans for Tax Reform applauds the 206 members of the House of Representatives who voted in favor of H.J. Res. 98, the joint employer CRA.
The Senate must now pass the resolution and send it to President Biden’s desk.