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US Labor Department moves to ease companies’ liability for franchisee wage violations

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The U.S. Department of Labor on Monday issued a proposal that would make it more difficult to prove companies are liable for the wage law violations of their contractors or franchisees, a top priority for business groups.

If adopted, the rule would likely help fast-food companies and other franchisors who have been sued by workers in recent years for wage-law violations by franchisees.

The department in 2017 had already repudiated legal guidance issued by the Obama administration that had expanded the circumstances in which a company could be considered a so-called joint employer under the federal Fair Labor Standards Act (FLSA).

Labor Secretary Alexander Acosta in a statement said Monday’s proposal would reduce litigation under the FLSA and provide clarity to businesses and courts. The FLSA mandates that workers be paid the minimum wage and overtime, among other requirements.

Publication of the rule kicked off a 60-day public comment period.

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Under the proposal, companies would be considered joint employers only if they hire, fire, and supervise employees, set their pay, and maintain employment records. That would likely exclude many franchisors and companies that hire contract labor.

The Obama administration’s guidance included several other factors, such as the nature of the work being performed and whether workers were integral to a company’s business. That definition of joint employment had rankled the business community, which said it threatened the franchise business model and would lead to a spike in lawsuits.

Matt Haller, vice president at the International Franchise Association, a trade group, said the Obama-era rule had led to frivolous lawsuits and changed the way franchisors interacted with franchisees.

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“Through this proposal, the Department of Labor has the chance to undo one of the most harmful economic regulations from the past administration,” he said.

The Obama-era regulation was not legally binding, but Monday’s proposal would be if it is adopted. That would make it more difficult for future administrations to undo, but also open it up to legal challenges.

The proposal comes as the National Labor Relations Board is moving to roll back a separate Obama-era standard for determining joint employment under federal labor law, which governs union organizing and workers’ rights to advocate for better working conditions. Under a rule the NLRB proposed in September, companies would have to possess direct control over working conditions to be considered the joint employer of franchise or contract workers.

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Reporting by Daniel Wiessner in Albany, New York, Editing by Alexia Garamfalvi and Matthew Lewis


Report typos and corrections to [email protected].
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‘I’ve had it!’ MSNBC’s Donny Deutsch goes on epic rant telling white people ‘if you vote for Trump — you own it’

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In an epic rant on MSNBC Wednesday, political commentator Donny Deutsch went off telling white people that they need to wake up and prove they're not racists.

"Enough is enough!" he began, looking directly into the camera. "I want to talk to the white people out there, okay. I want to talk to wealthy white people because I’ve had it. I’ve had discussions, when I talk to friends, people I know, [who say] 'It’s good for the economy. It’s good for the economy.' No, it's time."

He explained that if someone is working-class and they believe Trump will get them a job, they at least have an excuse.

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Nicolle Wallace explains Trump’s racist attacks are covering his cozy relationship with Jeffrey Epstein and Michael Cohen scandal

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MSNBC host Nicolle Wallace began her Wednesday show saying that President Donald Trump has made it official by making his brand one of "racism." But it prompted her to wonder if his racist attacks against four congresswomen of color could be more about deflecting from other scandals.

Wednesday morning, MSNBC released a video of Trump partying with alleged child molester and rapist Jeffrey Epstein. Trump is seen groping women and slapping their posterior. The first round of Epstein's alleged crimes were downgraded by Labor Secretary Alex Acosta and he was given 13 months in a county jail for just 8 hours, six days a week.

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Trump wasn’t the first president to confront the Supreme Court – and back down

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A key presidential election is approaching. The U.S. Supreme Court hears a case with powerful political implications. The court rules, but the populist president doesn’t care. Our national commitments – to the Constitution, to morality, to the rule of law – seem at risk.Then, the president backs down. The nation survives.

This might be the story of President Trump’s short-lived threat to get a citizenship question on the census in defiance of the Supreme Court. Instead, it’s the story of President Andrew Jackson and Worcester v. Georgia, decided in 1832.

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