WFI LETTER: Chairwoman Foxx Correspondence Concerning The Save Local Businesses Act

October 3, 2017

The Honorable Virginia Foxx
Chairwoman
Committee on Education and the Workforce
2262 Rayburn House Office Building
Washington, D.C. 20515

Dear Chairwoman Foxx,

On Behalf of the Workforce Fairness Institute (WFI), an organization devoted to educating workers, their employers, employees and citizens about issues affecting the workplace, I would like to thank you for scheduling a markup of H.R. 3441, the Save Local Businesses Act. This legislation would free job creators – particularly those in the franchise space – from the new “joint-employer” standard, an anti-growth, anti-worker regulation put in place by the Obama-era National Labor Relations Board (NLRB).

This new standard, which was modified in 2015 by the Browning-Ferris ruling, marked the reversal of decades of established labor law. Previously, the standard was that employers were responsible only for those employees whom they exerted “direct control” over. However, the new standard established a policy wherein liability was expanded to businesses that did not have direct purview over workplace employees or were under their “indirect control.”

While this misguided policy’s implications were widespread, it particularly threatened the franchise industry. By forcing parent companies to assume liability for their franchisees’ employees, businesses became responsible for measures far beyond their own control and risked millions of jobs.

Thankfully, your committee is scheduled to markup legislation that would end this misguided policy and restore the balance of power in workplaces across the country. The Save Local Businesses Act would amend the National Labor Relations Act and the Fair Labor Standards Act to clarify that two or more employers must have “actual, direct and immediate” control over employees to be considered joint employers. In effect, this bill would preserve the franchise business model for thousands of small businesses and free employers from the risk of liability for actions undertaken by other independently owned and operated entities.

Despite the usual partisan divide in Washington, this legislation enjoys broad, bipartisan support. The bill has 80 cosponsors, including Democratic Representatives Henry Cuellar of Texas, Luis Correa of California and Collin Peterson of Minnesota.

Americans need confidence that their representatives in Washington are committed to standing up against burdensome and ill-conceived regulations and committed to advancing a pro-growth and pro-worker agenda. In sum, the Save Local Businesses Act would do just that. This legislation is smart policy which deserves the support of the members of the Committee on Education and the Workforce. To expeditiously move this legislation to the President’s desk, I urge you pass the Save Local Businesses Act out of committee and advocate for a vote in the near term on the floor of the U.S. House.

Sincerely,

Heather Greenaway
Workforce Fairness Institute

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The Workforce Fairness Institute is an organization committed to educating voters, employers, employees and citizens about issues affecting the workplace. To learn more, please visit: http://www.workforcefairness.com.

To schedule an interview with a Workforce Fairness Institute representative, please contact Ryan Williams at (202) 677-7060.

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AZ Daily Sun--Coconino Voices: PRO Act legislation would hurt local businesses

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By: Julie Pastrik Arizona businesses and workers have had an incredibly challenging year given the economic slowdown that followed in the wake of the coronavirus pandemic. However, local businesses and industries across the state are resilient and on the road to a strong recovery that will mean more jobs for Arizona workers and increased economic development to strengthen our communities. That is, as long as Congress does not move forward with potentially devastating legislation that would hurt local employers and employees alike while impeding our state’s economic recovery. Unfortunately, some members of Congress seem determined to do just that by pushing through the Protecting the Right to Organize (PRO) Act. As harmless as the name may sound, the PRO Act would have serious repercussions for local businesses, particularly smaller ones, while undermining long-standing rights for employees and threatening the growing gig economy that has helped provide much-needed income for so many during this time. Arizona is fortunate to have leaders like Senators Mark Kelly and Kyrsten Sinema, who have both refrained from joining the vast majority of their Democratic colleagues in cosponsoring the PRO Act. In a slap in the face to Arizona workers, the PRO Act removes one of the most fundamental rights a worker has when it comes to voting in elections to determine whether to unionize: the secret ballot. Instead, workers could be forced to sign union authorization cards in front of other employees, their employer, or union organizers. This bill would also destroy workers’ right to privacy by allowing unions access to personal information, including their home address and personal phone number. If that doesn’t open the door to union intimidation and harassment, I don’t know what does. As if that was not bad enough, the PRO Act would create major new challenges for Arizona businesses, making it harder for them to create jobs, expand in their communities, and even keep their doors open. It would redefine what it means to be a “joint employer” under national labor law, greatly complicating existing relationships between franchisors and franchisees as well as between business owners, contractors, subcontractors, and vendors and suppliers. At the same time, it would interfere with attorney-client confidentiality and make it much more difficult for small businesses to secure a legal advice on labor issues. Particularly harmful during these times, the PRO Act would apply a failed policy from California to national labor law by using the “ABC” test to determine whether a worker is an independent contractor or employee. This makes it much harder to qualify as an independent contractor, threatening the freedom and flexibility that tens of thousands of Arizonans find in independent contracting and gig economy work. Ultimately, the PRO Act is bad public policy that only works for union leaders to inflate their falling ranks while threatening workers’ rights, undermining small businesses, and jeopardizing a growing part of our economy. This is not a good solution for Arizona, and Senators Sinema and Kelly should stay firm and not cosponsor this misguided legislation.