FMI letter opposes joint-employer proposal

The Food Industry Association (FMI) is voicing opposition to a proposed joint-employer standard that is used to determine when two or more businesses share direct and indirect responsibility of a worker.

In its regulatory comment letter to the National Labor Relations Board (NLRB), Arlington, Va.-based FMI said changes which would deem business-to-business arrangements as joint employer relationships have the potential to upend operational relationships that have been at the core of the food industry for decades.

“FMI members have unique needs in meeting staffing requirements in stores, distribution facilities and divisions throughout their business operations,” Christine Pollack, FMI vice president, government relations, said in the letter. “In addition to hiring direct employees, these businesses fulfill operational needs through vendors, contracts, and temporary staffing relationships. Utilizing the expertise and specialty skills of these separate businesses should not constitute a joint employer status.”
 
In addition, Pollack said that the NLRB’s Notice of Proposed Rulemaking (NPRM) is a “significant expansion of the essential terms and conditions of a joint employer relationship to capture health and safety standards and hours of work and scheduling would negatively impact every aspect along the food and consumer goods supply chain.”

The letter also said that the food industry is ever evolving due to many factors, including supply chain challenges, consumer trends and demands, and economic conditions, and that the staffing needs of manufacturing, warehousing and retailing must remain flexible to meet these changes and demands. 

“The nature of the case-by-case adjudication under the NPRM does not give FMI members the certainty needed to address current and future consumer trends,” the letter said. “The NPRM is a vast overreach and should not be implemented.”

In addition to its own comment letter, FMI signed the letter filed by the Coalition for a Democratic Workplace (CDW), a coalition of numerous employer trade associations, which claimed that the proposed rule will undermine collective bargaining and destabilize labor relations; is arbitrary and capricious; and diverges from the common law. 

The CDW also said that the NPRM “ignores federal law, Congressional intent, and court precedent and, in doing so, threatens existing economic relationships and future opportunities for millions of entrepreneurs.”

In April, the NLRB proposed to rescind and replace the joint-employer rule that took effect in 2020, with the board noting in a statement that changes are intended to “explicitly ground the joint-employer standard in established common-law agency principles, consistent with board precedent and guidance that the board has received from the U.S. Court of Appeals for the D.C. Circuit.
 
Under the proposed rule, the standard would consider two or more employers joint employers if they “share or codetermine those matters governing employees’ essential terms and conditions of employment,” such as wages, benefits and other compensation, work and scheduling, hiring and discharge, discipline, workplace health and safety, supervision, assignment, and work rules.

The board proposed to consider both direct evidence of control and evidence of reserved and/or indirect control over these essential terms and conditions of employment when analyzing joint-employer status.

“In an economy where employment relationships are increasingly complex, the board must ensure that its legal rules for deciding which employers should engage in collective bargaining serve the goals of the National Labor Relations Act,” NLRB Chairman Lauren McFerran said in a statement at the release of the NPRM. 

“Part of that task is providing a clear standard for defining joint employment that is consistent with controlling law.” She said that the Board’s joint employer standard “has been subject to a great deal of uncertainty and litigation in recent years. Rulemaking on this issue allows for valuable input from members of the public that will help the board in its effort to bring clarity and certainty to these significant questions.”