First, it reversed an Obama-era rule helping workers challenge the labor practices of big chains. On Monday, the National Labor Relations Board reversed its reversal.
The move will make it easier to hold companies responsible for labor law violations committed by franchisees and contractors.
Labor advocates and business groups alike were surprised by the turnabout, but it did not reflect any ideological shift. Rather, it followed a determination that a member of the board’s Republican majority had a conflict of interest in the earlier vote.
A report released in early February by the agency’s inspector general found that the member, William J. Emanuel, should have recused himself when the case came before the board in December, shortly after the Republicans gained control. That would have left it split at two votes apiece and preserved the status quo.
On Monday, three other board members, including its Republican chairman, Marvin E. Kaplan, voted to vacate the December decision, citing a determination that Mr. Emanuel “is, and should have been, disqualified from participating in this proceeding” because his former law firm had handled a related case.
That opens the door for the more expansive, Obama-era standard to remain in place for several more months, perhaps even years.
Wilma B. Liebman, a Democratic former board member who served as chairwoman early in the Obama administration, said it was highly unusual for a labor board ruling to be reversed because of a conflict — perhaps illustrating the stakes involved.
“I’ve never seen anything like this,” Ms. Liebman said.
Two Democratic senators, Patty Murray of Washington and Elizabeth Warren of Massachusetts, have been outspoken in recent months in pointing to Mr. Emanuel’s potential conflicts.
The issue before the board involved a doctrine known as joint employment. A company, like a fast-food corporation, that is deemed a joint employer of workers at a franchisee can be held liable for violations of their labor rights — such as illegally firing workers involved in an organizing campaign — and can be required to bargain with them if they unionize.
Before 2015, a company could be considered a joint employer under federal labor law only if it exercised direct and immediate control over workers at the franchise.
But in a case known as Browning-Ferris, the board ruled that the parent company could be deemed a joint employer even if the control it exerted was indirect — for example, if it forced the franchisee to use software that committed it to certain scheduling practices. The board ruled that the parent company could also be considered a joint employer if the company had the right to exercise control over a franchisee that it did not exercise in practice.
The more liberal definition of who qualified as a joint employer removed a potentially significant obstacle to workers at fast-food restaurants and hotels who sought to unionize. A parent company that terminates a franchise agreement to avoid doing business with a franchisee whose workers are trying to unionize may face legal liability for doing so if it is considered a joint employer.
In December, the board, with its new Republican majority, took up a case known as Hy-Brand and voted to revert to the pre-2015 standard requiring direct and immediate control.
But that case did not raise any questions that hinged on what standard to apply — the Obama-era guidelines or the previous ones. Partly as a result, the inspector general argued in his report, it was simply a pretext for relitigating Browning-Ferris.
“The practical effect of the Hy-Brand deliberative process was a ‘do-over’ for the Browning-Ferris parties,” the inspector general stated.
This created the potential conflict for Mr. Emanuel, whose former law firm had represented a party in the Browning-Ferris case. If the more recent case was simply a do-over for the previous case, the inspector general argued, then Mr. Emanuel should have recused himself.
Ms. Liebman, the former chairwoman, said the board would presumably be able to try again. But she said it would have to wait for a case raising its own questions about which joint-employer doctrine is correct, rather than simply use any vaguely related case as a pretext for revisiting the Obama-era decision.
“In some future case, where the issue actually arises and some party is seeking a reversal of Browning-Ferris, where more of a deliberation goes on, that could be another vehicle,” she said, adding that there was less likely to be a conflict for Mr. Emanuel in that instance. “This is likely just a reprieve.”
For their part, business groups frustrated with the frequently shifting joint-employer definition argued that it was yet another reason for Congress to settle the issue with legislation.
“This throws the whole situation back into question for a potentially extended period,” said Matthew Haller, a senior vice president at the International Franchise Association. “Our focus has been — and remains — on the need for Congress to provide legislative certainty.”
Mr. Haller added that the House had passed such legislation in November and that it was now all the more urgent for the Senate “to step into the breach.”
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