Labor board ruling could affect how businesses deal with temporary, franchise workers

In a 3-2 ruling split down party lines, the National Labor Relations Board revised its "joint employer" standard, a decision that could have huge ramifications for franchise businesses like McDonald's.

The board decided that the waste management company Browning Ferris Industries is a joint employer alongside one of its subcontractors, the staffing firm Leadpoint Business Services. The Teamsters wanted Browning Ferris to be named a joint employer so it would have to join Leadpoint at the bargaining table.

The ruling makes it difficult for a company like McDonald's to stay one step removed from the workers employed at its franchises. About 90 percent of the fast food chain's locations are run by franchisees, and each franchise is considered the employer of its workers, not McDonald's, The Huffington Post reports. Under these new loosened standards, McDonald's could end up having to bargain with workers employed by a franchisee.

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The Democratic members of the board wrote in their decision that it is "not the goal of joint-employer law to guarantee the freedom of employers to insulate themselves from their legal responsibility to workers, while maintaining control of the workplace. Such an approach has no basis in the [National Labor Relations] Act or in federal labor policy." Labor unions say it only makes sense for a parent company to be legally responsible for employees who represent their company, even if they don't necessarily sign their paychecks. Franchisers argue it will give the parent company too much control over their business.