Dive Brief:

• President Joe Biden vetoed a Congressional Review Act measure to overturn the National Labor Relations Board rule broadening joint employer liability, fulfilling a promise made in January, the White House announced Friday.
• The CRA measure passed the Senate in a nearly party-line vote in April, and passed the House of Representatives in a largely, but somewhat less, polarized vote in January.
• The veto saves the NLRB’s rule legislatively, but the regulation was vacated by a federal judge in Texas in March, though it may yet be appealed. The NLRB’s rule expands the bargaining obligations and liabilities of employers that reserve control of essential conditions of employment or exercises such control indirectly. 

Dive Insight:

Matthew Haller, CEO of the International Franchise Association, which has made the overthrow of the NLRB’s expanded joint employer rule a political priority, denounced the veto in a statement emailed to Restaurant Dive.

“President Biden claims to be a champion for small businesses, but today he turned his back on franchising,” Haller said. Haller said the rule was part of a “regulatory assault” on business. 

Sean Kennedy, EVP of public affairs for the National Restaurant Association, said the veto was disappointing but not an immediate threat to franchisors, in a statement emailed to Restaurant Dive. 

“A recent court decision rolling the Joint Employer Standard back to the 2020 rule means that today’s action won’t negatively impact restaurant owners,” Kennedy said. “There’s still uncertainty every day that another wrenching change to the Standard is just around the corner.”

Biden used the announcement as a tool of pro-labor party discipline, implicitly chiding Sen. Joseph Manchin (D, WV) and the several representatives who crossed the aisle to back the CRA measure.

“By hampering the NLRB’s efforts to promote the practice and procedure of collective bargaining, Republicans are siding with union-busting corporations over the needs of workers and their unions,” the president wrote in his message accompanying the veto. “If multiple companies control the terms and conditions of employment, then the right to organize is rendered futile whenever the workers cannot bargain collectively with each of those employers.”

Labor issues have emerged as a point of campaign strategy for the embattled president. Since Biden walked a United Auto Workers picket line during the union’s Stand Up Strike last fall, the president has sought to align himself more publicly with organized labor — as the labor movement experiences a surge in popular support. Biden appeared at the UAW’s community action program conference in January, where the union endorsed him, and within the last month spoke at conferences hosted by the International Brotherhood of Electrical Workers and North America’s Building Trades Unions. 

Unions like UNITE HERE and the Service Employees International Union, which both have a significant presence in industries where the NLRB joint employer standard could change labor relations, are likely key to Biden’s re-election chances. The SEIU already pledged $200 million to back the Democrats, while UNITE HERE endorsed the president in 2023 after mobilizing significant resources in battleground states during the 2022 midterms.