Trump positioned to deliver unions another crushing blow

Tim Pearce, DCNF

  • Democrat Mark Pearce’s term on the National Labor Relations Board is up on Aug. 27 when he will either leave the board or be reappointed
  • The board is controlled by a Republican majority, however, one Republican member was forced to recuse himself in a case that would have overturned a key 2014 decision that upset decades of precedent and left franchisers vulnerable to lawsuits and union influence
  • If President Donald Trump leaves Pearce’s seat vacant or appoints a business-friendly new member, the 2014 ruling could be overturned. Otherwise, congressional action will likely be necessary

Unions are on the verge of losing one of their staunchest allies on the National Labor Relations Board (NLRB) when Democrat Mark Pearce’s term runs out the end of August.

Fast food workers and activists demonstrate outside McDonald’s downtown flagship restaurant on July 31, 2014 in Chicago, Illinois. According to a recent ruling by the National Labor Relations Board (NLRB) McDonald’s USA can be considered a joint employer at its franchised restaurants, a decision that could affect how the restaurant chain is forced to deal with organized labor disputes. (Photo by Scott Olson/Getty Images)

The NLRB oversees organized labor and employer-employee relations. Pearce joined the board in April 2010 after former President Barack Obama appointed him during a Senate recess. The Senate later confirmed Pearce, and Obama reappointed him in August 2013 to serve a 5-year term ending on Aug. 27.

With the end of Pearce’s term imminent, pro-business interests have lobbied the White House and President Donald Trump to let Pearce’s time run out rather than reappoint him for another 5-year term. Pearce is interested in serving another term and Trump is considering reappointing him while keeping the current 3-2 Republican majority on the board, Bloomberg reported.

Pearce’s reappointment would not change the NLRB’s current power dynamic, but refusing to reappoint him would give NLRB Republicans the chance to overturn a 2014 board decision that businesses and industries have protested for four years.

“Rather than act as a neutral arbiter of labor law, Mark Pearce has used his eight years on the NLRB to advance Big Labor’s agenda at every opportunity,” Freedom Foundation director of labor policy Maxford Nelsen told The Daily Caller News Foundation in a statement. “Perhaps most significantly, Pearce waged an all-out assault against the popular franchise model by helping to pave the way, through the board’s drastically expanded joint employer standard, for unions to organize entire parent companies instead of having to persuade employees at individual franchises to join.”

The NLRB overturned three decades of precedent in 2014 and broadened the definition of a “joint-employer” to include businesses or companies that share “direct or indirect” control over employees. The new rule most affected franchisers — such as McDonald’s — that allow other individuals or entities to sell the franchiser’s services or products conditionally under the same brand name.

The new definition made franchisers vulnerable to lawsuits and fines from labor violations committed by their franchisees, and the rule gave unions direct bargaining power with the corporate headquarters when one franchisee’s store is unionized.

“One goal was to make it easier for unions to organize workers in fragmented workplaces with multiple subcontractors,” The Wall Street Journal editorial board wrote in March. “Unions could also bring deep-pocketed corporations to the bargaining table.”

The NLRB, after Republicans took majority under Trump, reversed the 2014 decision in December, reinstating the previous standard for a joint employer of exercising “direct” control over workers. The December decision was reversed, however, after one of the Republicans who helped to overturn it, William Emanuel, recused himself after NLRB Inspector General David Berry alleged Emanuel had a conflict of interest.

By picking a more moderate Democrat to sit on the NLRB or refusing to fill Pearce’s soon-to-be-vacant seat, Trump could ensure a Republican majority on the board to overturn the 2014 joint-employer decision.

An attempt to keep Pearce off the board will likely raise the ire of congressional Democrats. Pearce is supported by Senate Minority Leader Chuck Schumer, according to Bloomberg.

Pro-business interests and lobbyists have made enough noise to inspire congressional action to protect franchisers. The House passed a bill in 2017 to codify the narrower definition of a “joint employer.” The bill has been sent to the Senate, but it is unclear if it will come up for a vote before midterms.

This post was updated to correctly spell NLRB member Mark Pearce’s name.

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