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Long-sought U.S. labor rule change raises worker safety questions in coronavirus crisis

[April 30, 2020] By Tom Hals

(Reuters) - Some contract workers in America's fast food restaurants, hospitals and warehouses could find it harder to demand equipment and other measures to protect them from the coronavirus under a new labor agency rule, according to workers' advocates and unions.

The National Labor Relations Board (NLRB) rule that was published in the federal government register in February and took effect on April 27, says companies must have direct control over "essential" working conditions of franchise employees and contract workers in order to be considered their "joint employers." The NLRB threw out a precedent that said companies can be joint employers when they exercise indirect control over contract workers' essential conditions.

The agency has said the new rule restores a standard that had been applied for decades and adds clarity.

Labor advocates on the other hand say that under the new rule, a company that uses contract labor is less likely to be forced to bargain with workers, be held liable for labor violations or be targeted by pickets.

Unions have criticized the NLRB for excluding health and safety as one of the essential conditions that determines when a company is a joint employer.

"Unfortunately, with this joint employer rule, the government is weakening the standards, moving in exactly the wrong direction," said Karla Gilbride, an attorney at legal advocacy organization Public Justice.

A business group representing human resources executives said the rule change could actually encourage companies to take a more active role in worker safety because previously, potential liability issues gave them pause.

"The unions have it completely backwards on safety, particularly in this environment," of the coronavirus pandemic, said Roger King, of the HR Policy Association.

Redefining the so-called joint employer standard has been a goal for years for companies such as McDonald's Corp <MCD.N> and others that run franchises or rely on outsourced staff. These companies also include hotel operators, call centers and package delivery operations of Fedex Corp <FDX.N> and Amazon.com Inc <AMZN.O>.

In March, the Department of Labor made a similar change to the definition of joint employer under the Fair Labor Standards Act, which governs pay and overtime.

The changes are being made as the economy is shrinking at the fastest rate in more than a decade because of the impacts of the coronavirus and U.S. President Donald Trump is eager to have some businesses reopen after more than a month of closures designed to contain the spread of the virus.

But workers are scared of getting infected and some have staged protests over fears they are being exposed at work to the novel coronavirus that causes the COVID-19 respiratory disease. At least 60,000 people have died in the United States, the most in the world, according to a Reuters tally.

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A modified business schedule is displayed on the window of a closed business during the outbreak of the coronavirus (COVID-19) disease in Washington, U.S., April 29, 2020. REUTERS/Leah Millis

HOSPITAL JANITORS

Workers' advocates say the NLRB rule will, for example, prevent janitors who work in hospitals and are employed by a staffing agency, from demanding safety measures that could protect them from the coronavirus.

That's because the agency that employs the janitors controls the conditions the new rule deems essential, such as pay, hours and discipline. The hospital may control the health and safety conditions that could expose the janitors to coronavirus at work, but the hospital would not be considered a joint employer under the new rule.

As a result, the hospital management would have no legal duty under federal labor law to come to the bargaining table and negotiate with the janitors over safety.

"It is outrageous and shameful that, now of all times, the agency that exists to protect these workers' rights is working overtime to make it harder for them to win basic safety protections from their employers," said Nicole Berner, the general counsel of the Service Employees International Union. Its affiliate is the largest U.S. healthcare union.

King of the HR Policy Association said that under the old precedent even giving a training video to contract workers could have made the company a joint employer and by extension possibly liable for labor violations by a contract staffing company.

He dismissed union arguments that the new rule will undermine safety. "This is really a stretch," he said.

Fedex and Amazon did not immediately respond to a request for comment, but the companies have generally opposed attempts in court to hold them liable for alleged labor violations by independent delivery companies. Both have said they were adopting additional sanitizing and cleaning measures to protect staff and customers because of the epidemic.

(Reporting by Tom Hals in Wilmington, Delaware; additional reporting by Dan Wiessner in Albany, New York and Hilary Russ in New York; Editing by Noeleen Walder and Grant McCool)

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