Employers Beware: McDonald’s Memorandum Suggests That the NLRB Intends to Loosen the Standard for When Legally Separate Entities May Be Considered Joint Employers

In late July, the General Counsel of the National Labor Relations Board (the “NLRB” or “Board”) issued a memorandum in a group of cases against operators of several McDonald’s franchises. The memorandum is significant because it indicates that the General Counsel is filing unfair labor practice charges not only against the McDonald’s franchise operators, but against McDonald’s USA, LLC, the franchisor, or what many people think of as “corporate McDonald’s.”

The memorandum has touched off a firestorm of criticism from employers and business groups, because it indicates that the NLRB is pushing for a more lenient standard for when two separate and distinct business entities may be considered to be “joint employers” and held liable for unfair labor practice charges and collective bargaining obligations.