The standards used to determine joint-employer status remained steady for more than three decades before a 2015 National Labor Relations Board decision that has led to a regulatory back-and-forth in the years since.
"We actually are referring to it as a bit of a whiplash effect given all the changes that have occurred in this area over the past few decades, and really over the past few years with the change in the most recent administration," said Andria Ryan, partner at Fisher Phillips and co-chair of the law firm's hospitality group.
Speaking on the Hotel News Now Podcast, Ryan, a labor attorney, said the NLRB released its latest rule last week on whether companies can be considered a joint employer of workers.
Prior to the 2015 Browning Ferris NLRB decision, two companies could only be considered a joint employer of workers if they shared or co-determined matters that governed an employee's terms and conditions of employment, she said. That could include hiring, pay, benefits and discipline, among other factors.
"The law at the time said you must actually exercise the control over that group of employees to be considered a joint employer," she said.
With the latest rule, however, those standards are much broader by comparison, she said.
Those who were not considered joint employers before could now find themselves in collective bargaining agreements and liable for unfair labor practices, Ryan said.
The new rule could affect the relationship between franchisors and franchisees, hotel owners and third-party managers, hotel operators and staffing agencies — and potentially more — depending on their business contracts, she said.
For more about how the new joint-employer standard could affect the hotel industry, listen to the podcast above, and subscribe to the Hotel News Now podcast on Apple, Spotify or wherever you find podcasts.