May 3, 2021

FEDA Signs Letter Supporting Direct Control Standard for Joint Employers

FEDA has signed on to a letter urging legislators to amend the National Labor Relations Act and the Fair Labor Standards Act to make clear that an employer may be considered a joint employer only if it has direct control over the employee.

The long-understood definition of what constitutes a joint employer has been muddied the last few years after the Obama administration reversed the standard for the purposes of labor union organization to include employers with indirect control.  The Trump administration later rescinded that change, however, President Joe Biden appears to be investigating reverting back to the Obama-era rule. As a result, Rep. James Comer (R-KY) and Sen. Roger Marshall (R-KS) plan to reintroduce the Save Local Business Act to codify a direct control joint employer standard in both the Fair Labor Standards Act and the National Labor Relations Act.

A coalition of associations, including the National Association of Wholesaler-Distributors, has prepared a letter in support of the Save Local Business Act. “This legislation comes at a critical time in the economic recovery when so many small businesses are emerging from the COVID-19 pandemic and seek clarity in the law to help them better grow their businesses, create jobs, serve their communities and meet local, state and federal obligations to their employees, customers and the general public,” the letter states.

To read the full letter, click here.