Sen. Marshall, Rep. Comer Seek to Improve Regulatory Environment for Small Businesses

Washington, D.C. –U.S. Senator Roger Marshall, M.D., and House Oversight Chairman, Representative James Comer (KY-01), introduced bicameral legislation, the Save Local Business Act. This legislation codifies much-needed federal standards for joint employers. 

The Department of Labor proposed new joint employer rules in September 2022, marking the third time since 2015 that joint employer standards have gone through the federal rulemaking process. Frequent changes have resulted in legal confusion for the business community. The Save Local Business Act provides clarity and improves businesses’ ability to operate without violating federal joint employer rules.

“You can’t focus on running a business if the federal government keeps changing the rules. The Save Local Business Act provides long-overdue clarity and consistency that will protect our nation’s small businesses,” Senator Marshall said. “The Biden Administration’s Labor Department has relied on complicated court rulings to handle joint employers instead of providing clear guidance to the business community. In a time of economic hardship, we should be doing all that we can to help our nation’s small businesses, not let the heavy hand of government regulations run amok.” 

“Congress must promote policies that empower small businesses and free them from stifling regulations pushed by an unchecked and unelected federal bureaucracy,” Congressman Comer said. “Our bill, the Save Local Business Act, will add common sense to the definition of a joint employer, protect the franchise business model, and reduce bureaucratic headaches for American job creators. Now is the time for job growth and creation, not harmful and unclear regulations.”

The Save Local Business Act has already received resounding support from business leaders. Two letters expressing support for the Save Local Business Act were released by coalitions that represent the interests of businesses of various sizes and American taxpayers. You may click HERE to read the letter from the business coalition, and you may click HERE to read the letter from the taxpayer coalition. Additionally, the below organizations have expressed their support.

“NTU is proud to lead a coalition of eighteen organizations in applauding Senator Roger Marshall and Chairman James Comer for introducing the Save Local Business Act of 2023. This important legislation will protect taxpayers and local small businesses from tumultuous uncertainty caused by National Labor Relations Board overreach. The commonsense bill ends the seesaw effect of changing NLRB majorities by codifying the traditional definition of joint employment. From inflation to staffing shortages to supply chain issues, the last thing that Main Street businesses and taxpayers need are stacks of legal bills from trying to figure out if they’re a joint employer and the Save Local Business Act will stop this legal uncertainty immediately.” – Nick Johns, Policy & Government Affairs Manager, National Taxpayers Union

“More than any other policy, franchise businesses need the certainty of the Save Local Business Act. IFA applauds Congressman Comer and Senator Marshall for reintroducing the Save Local Business Act, a common-sense bill that, if enacted, will indeed save hundreds of thousands of franchise small businesses from regulatory overreach. As the misguided National Labor Relations Board prepares to finalize an unnecessary and harmful joint employer standard later this year, it is critical that Congress pass the Save Local Business Act to provide franchise brands and owners with a reasonable, clear and consistent standard of joint employer so they can continue growing and thriving.” – Michael Layman, Senior Vice President, Government Relations and Public Affairs, International Franchise Association

In the U.S. Senate, Senators John Barrasso (WY), Mike Braun (IN), Bill Cassidy (LA), Kevin Cramer (ND), Bill Hagerty (TN), Cynthia Lummis (WY), Marco Rubio (FL), and Roger Wicker (MS) are original cosponsors of the Save Local Business Act.

You may click HERE to read the Save Local Business Act.

Background:

In 2015, the National Labor Relations Board (NLRB) placed itself in the middle of the employer-employee relationship; hiring, work schedules, and pay increases were no longer solely between an employer and an employee. This prompted a similar expansion of the joint employer standard under the Fair Labor Standards Act (FLSA). With these actions, the Obama administration and the NLRB discarded settled labor policy and blurred the lines of responsibility for decisions affecting the daily operations of local businesses across the country. The Department of Labor is now working to reinstate this harmful framework through a final rulemaking later this year. 

Under the current administration’s most recently proposed definition, two or more employers can be considered joint employers for making a business agreement that “indirectly” or “potentially” impacts their employees’ day-to-day responsibilities and working environment. 

According to the American Action Forum, the joint employer scheme could result in 1.7 million fewer jobs. 

The Save Local Business Act:

• Amends the National Labor Relations Act and the FLSA to clarify that two or more employers must have “actual, direct, and immediate” control over employees to be considered joint employers.
• Rolls back a convoluted joint employer scheme that threatens job creation and undermines the American Dream.
• Restores a commonsense definition of employer to provide certainty and stability for workers and employers.
• Protects workers and local employers from future overreach by unelected bureaucrats and activist judges.

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