Bobby Scott

Mr. SCOTT of Virginia

Mr. SCOTT of Virginia. Mr. Speaker, I yield myself the balance of my time to close. Mr. Speaker, the last Congress, we tried to get together on a reauthorization of WIOA, but we couldn't come to an agreement. We passed the bill. It didn't pass the Senate. I am pleased that this Congress, Chairwoman Foxx and I and the committee's staff were able to get together and work together on a bipartisan draft of the Stronger Workforce for America Act. I am grateful that the committee staff, particularly Scott Estrada and Marek Laco, spent countless hours drafting this legislation. This bill is an example of the great work that can get done when we work together, so I urge my colleagues to support the legislation, which will meaningfully strengthen our workforce. Mr. Speaker, I yield back the balance of my time.

Mr. SCOTT of Virginia

Mr. SCOTT of Virginia. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I rise in support of S. 2051. All children deserve a safe, loving home and to have their basic needs met. When a child goes missing or suffers abuse, families experience unimaginable pain and horror. For children, the trauma is much worse. Many survivors of exploitation or abuse suffer physical and mental harm that can impact them for the rest of their lives. This pain has grown in recent years. We have seen a disturbing exponential rise in reported exploitation and child abuse cases, particularly online. For example, in 2023, the National Center for Missing and Exploited Children, NCMEC, received a staggering 36 million reports of child sexual abuse and sexual exploitation from public and electronic service providers, such as Facebook or Google on its CyberTipline. Members from both sides of the aisle have long agreed that NCMEC is essential to protecting and supporting exploited children, as well as restoring hope to parents and loved ones. Today, NCMEC is working diligently to keep pace with innovative technology and get ahead of evolving threats to our children's safety. I am grateful that our colleagues Representatives Courtney and Bean came out together to introduce the Missing Children's Assistance Reauthorization Act, which makes several improvements to NCMEC that the Chairwoman outlined a few minutes ago. The bottom line is that we are working to renew the authorization of NCMEC's grant program and to ensure that they have the necessary tools to protect America's most vulnerable children. Mr. Speaker, for these reasons, I support the legislation and urge my colleagues to support it. I reserve the balance of my time.

Mr. SCOTT of Virginia. Mr. Speaker, I yield such time as he may consume to the gentleman from Connecticut (Mr. Courtney), a senior member of the Committee on Education and the Workforce.

Mr. SCOTT of Virginia. Mr. Speaker, I yield myself the balance of my time to close. Vulnerable youth are at heightened risk of endangerment. Additionally, LGBTQ+ youth face disproportionate rates of experiencing homelessness, often caused by fleeing abuse or rejection by family members. No child should be in harm's way or exploited because of who they are. The majority of missing child cases reported to NCMEC involve endangered runaways. Importantly, NCMEC works with a diverse group of stakeholders, uses trauma-informed practices, and uses a case management approach to ensure that it meets the needs of each child individually, taking into consideration their diverse needs. I am grateful to Representatives Courtney and Bean for introducing the House companion bill. This legislation makes several important improvements to NCMEC's grant program and, importantly, reauthorizes it. I call on my colleagues on both sides of the aisle to support the legislation, and I yield back the balance of my time.

Mr. SCOTT of Virginia

Mr. SCOTT of Virginia. Mr. Speaker, I rise today to congratulate the Woodside High School Men's Basketball Team from Newport News, Virginia on becoming the Virginia High School League's Class 5 State Champions. On Saturday, March 9, 2024, the Woodside Wolverines won the Class 5 State Championship Game against the Lloyd C. Bird Skyhawks with a score of 53-33. This is the second year in a row that Woodside High School has claimed a state championship title. Led by Coach Stefan Welsh, the Wolverines closed their season with a record of 27 wins and 1 loss. The Wolverines and Skyhawks battled throughout the first and second quarters for an advantage. At the end of the second quarter, though, the Wolverines went on a 9-0 run positioning themselves into a 23-15 lead by halftime. The Wolverines then expanded their lead in the second half creating as much as a 23-point lead on their opponents. The Wolverines were able to defend this lead throughout the rest of the game and ultimately win the championship. Mr. Speaker, I want to again congratulate the Woodside High School Basketball Team and thank Coach Welsh, the parents, and the entire Woodside High School community for supporting these students throughout the season. I wish them the best in their future endeavors, and I wish the program continued success.

Mr. SCOTT of Virginia

Mr. SCOTT of Virginia. Mr. Speaker, I rise today to congratulate the Hampton High School Men's Basketball Team from Hampton, Virginia on becoming the Virginia High School League's Class 4 State Champions. On Friday, March 8, 2024, the Hampton Crabbers won the championship game against the Tuscarora Huskies with a score of 66-63. Led by Coach Eric Brown, the Crabbers won this title for the sixth time, the first since 2012. Hampton High School closed their season with a record of 26 wins and 2 losses, maintaining a 16-game winning streak. Throughout the game, the Crabbers and Huskies fought for control of the court, with the Crabbers maintaining the lead. But victory for the Crabbers would not come easily, as the Huskies consistently chipped away at their lead. With 20 seconds left on the clock, senior Daron Baugh sank two free-throws to give the Crabbers the final 66-63 lead. The Crabbers fought hard and stayed determined until the game was over, and because of that, they were able to secure the championship. Mr. Speaker, I want to again congratulate the Hampton High School Basketball Team and thank Coach Brown, the parents, and the entire Hampton High School community for supporting these students throughout the season. They have all made their community proud. I wish them the best in their future endeavors, and I wish the program continued success.

Mr. SCOTT of Virginia

Mr. SCOTT of Virginia. Mr. Speaker, I thank the gentlewoman for yielding. Mr. Speaker, I thank the gentlewoman for her longtime commitment to the child tax credit. We know it works, and she has been the most dedicated advocate for the child tax credit that we have in the United States Congress today. I thank Rosa DeLauro. When congressional Democrats and President Biden enacted the American Rescue Plan in 2021 without a single Republican vote, we prioritized the economic well-being of working families with the expanded monthly child tax credit. The expanded child tax credit under the American Rescue Plan reached 61 million children and reduced child poverty by nearly one-half, lifting nearly 3 or 4 million children out of poverty. In contrast, this bill is expected to lift only 500,000 children out of poverty when it is fully phased in. So this is not an extension of the child tax credit that we passed in the American Rescue Plan. It is not as generous, it does not help the lowest income families, and unlike the ARP plan, there are no monthly checks. People do not pay their bills once a year. They pay them monthly. So the impact of this program will not nearly be as strong as the former child tax credit that we passed in the American Rescue Plan. So this deal fails to reinstate the economic gains made for working families, and it fails to come anywhere close to the reduction of child poverty achieved under the American Rescue Plan. While providing only $33 billion in benefits for children, this bill prioritizes $185 million in tax cuts for corporations that were included in the 2017 Trump tax scam. It is overwhelmingly lopsided in favor of big corporations that are already paying historically low tax rates as a result of the Trump tax scam. What is even more egregious is that the bill makes the tax breaks for corporations and businesses retroactive and immediate, while not doing the same for working families. This doesn't make sense from either a budgetary or a public policy perspective, and is a bold display of misplaced priorities. It is notable that congressional Republicans sanctimoniously complain about the national debt and budget deficits. Earlier this month, Republicans on the House Budget Committee even passed the so-called Fiscal Commission Act because they were seemingly so concerned about the national debt and claim to want to do something about it, and yet, they consistently abandon all sense of fiscal responsibility when it comes to enacting corporate tax cuts. In fact, before the bill has even come to the floor, we just passed the tax cut last night costing about $200 billion that, when fully phased in over 10 years, will cost about $700 billion over the 10-year period. Mr. Speaker, ultimately, I voted ``no'' because this fiscally irresponsible tax deal is too lopsided in favor of corporations and special interests, while failing to provide equivalent support for working families. Mr. Speaker, I thank Rosa DeLauro for her advocacy for the child tax credit and for families.

Mr. SCOTT of Virginia

Mr. SCOTT of Virginia. Madam Speaker, I rise in opposition to H.R. 6914, the so-called Pregnant Students' Rights Act. In a post-Roe world where women face State-sanctioned abortion bans and complicated legal challenges to access healthcare, students should be aware of all of their reproductive options and protections. Yet, House Republicans in this bill are denying students the choice to decide by pushing an extreme bill that would keep students in the dark about the comprehensive healthcare choices, resources, and all of the rights that are available to them. On its face, the bill purports to provide pregnant students with resources available to them while they are seeking an education. In fact, the bill requires colleges and universities to distribute only partial information about existing rights under Title IX, as well as selective information on resources that solely encourage students to carry a pregnancy to term. Now, how can you make an informed and potentially life-changing decision if you are only provided with partial information about your rights and available resources? Madam Speaker, students already face challenges on campus, including mental health problems, financial and food insecurity, academic difficulties, just to name a few. This bill would make life much more challenging for students, but the true danger is in what the Republicans carefully left out. For example, the bill fails to require schools to inform students about contraception, which would help students actually avoid unplanned pregnancies; their rights and resources if they experience a miscarriage; and vital resources if they need to terminate a pregnancy due to health-related emergencies. In short, the bill provides students with just some of their rights, only selective rights. Contrary to their claims, the bill does not provide any new rights or resources like childcare assistance or affordable housing for pregnant or parenting students. Additionally, if a student decides to carry a child to term, this bill will not even provide any information on how to obtain funding, childcare, nutrition support like WIC, affordable housing options, or other critical supports. The bottom line is that here we are again wasting time with another harmful bill that jeopardizes sexual and reproductive healthcare for women. Restricting access to important information is both extreme and defies common sense. For these reasons, I urge my colleagues to vote ``no'' on this bill.

Mr. SCOTT of Virginia

Mr. SCOTT of Virginia. Madam Speaker, I yield an additional 30 seconds to the gentleman from California.

Mr. SCOTT of Virginia. Madam Speaker, I reserve the balance of my time.

Mr. SCOTT of Virginia. Madam Speaker, I yield 2 minutes to the gentlewoman from Oregon (Ms. Bonamici), who is a senior member of our committee and the ranking member of the Subcommittee on Early Childhood, Elementary, and Secondary Education.

Mr. SCOTT of Virginia. Madam Speaker, I yield 4 minutes to the gentleman from California (Mr. Takano), a senior of our committee, and the ranking member of the Veterans' Affairs Committee.

Mr. SCOTT of Virginia. Madam Speaker, I yield myself such time as I may consume. Madam Speaker, I rise in opposition to H.J. Res. 98, a Congressional Review Act resolution to repeal the National Labor Relations Board's joint employer rule, which the Board finalized last October. Through their unions, workers should be able to negotiate for higher pay, better benefits, and safer workplaces. However, that is not the case for millions of Americans, including janitors, housekeepers, cooks, and many others who are employed through subcontracts or temporary agencies. The rise of what is called ``fissured workplace,'' where firms increasingly use overlapping arrangements of contracting, subcontracting, and temping, has weakened workers' bargaining power and allowed large corporations to evade bargaining obligations and liabilities. For example, if employees of a subcontractor were to unionize, the subcontractor could refuse to bargain over pay, hours, workplace safety, or other issues because its contract with the prime contractor essentially sets the wages for the employees. Whoever is setting the wages ought to be the one at the bargaining table. If the workplace employer is essentially setting the wages, but you have to negotiate with the temp agency, and they say, ``That is all we can pay, so talk to somebody else,'' we need the somebody else at the table to be bargaining. Likewise, a temp agency may be restrained on what it can pay because of the contract with the owner of the workplace. Additionally, by evading bargaining obligations, the prime contractor who is actually setting the wages can shift liability for an unfair labor practice onto the subcontractor or the temp agency. The NLRB rule fixes this problem by ensuring workers can negotiate with all entities controlling their working conditions. This protects small businesses from being held liable for labor violations that are the result of other employers' actions. By repealing the NLRB's rule, H.J. Res. 98 would undermine workers' ability to exercise their rights and reinstate the deficient Trump-era rule that narrowed the joint employer standard. Under the Trump-era standard, employers who control the working conditions could easily evade their obligations to collectively bargain with employees. We should not go backward. The Biden-Harris administration's joint employer rule empowers workers and protects small businesses. My colleagues have just claimed that there is a problem with franchisees and the franchising model. These claims are unfounded, as there is no credible evidence showing that the rule would adversely affect the franchise model. In fact, if a problem arises, a strong joint employer standard will protect franchisees by ensuring the franchisors don't control the franchisees' labor relations and then leave the franchisees on the hook for the liabilities. I want to highlight that the American Association of Franchisees and Dealers wrote in support of both the Protecting the Right to Organize Act--that is, the PRO Act--joint employer standard and the Biden-Harris joint employer rule that we are talking about today. It is also important to point out that the NLRB has never found a franchisor to be a joint employer of a franchisee's employees. The joint employer rule reflects the best interests of the American people and our economy. Madam Speaker, I hoped that we would be standing with the workers and small business owners and not repeal a rule that protects them. I oppose the resolution, and I reserve the balance of my time.

Mr. SCOTT of Virginia. Madam Speaker, I reserve the balance of my time.

Mr. SCOTT of Virginia. Madam Speaker, I yield 3 minutes to the gentleman from California (Mr. DeSaulnier), the ranking member of the Subcommittee on Health, Employment, Labor, and Pensions.

Mr. SCOTT of Virginia. Madam Speaker, I yield back the balance of my time.

Mr. SCOTT of Virginia. Madam Speaker, I yield 2 minutes to the gentlewoman from Oregon (Ms. Hoyle).

Mr. SCOTT of Virginia. Madam Speaker, may I inquire how much time is remaining on both sides.

Mr. SCOTT of Virginia. Madam Speaker, I yield 2 minutes to the gentleman from Illinois (Mr. Sorensen).

Mr. SCOTT of Virginia. Madam Speaker, I yield 3 minutes to the gentleman from Texas (Mr. Casar).

Mr. SCOTT of Virginia. Madam Speaker, I include in the Record three letters in opposition to H.J. Res. 98. The first is signed by the AFL- CIO, SEIU, and Teamsters. The second is signed by the United Steelworkers. The third is signed by a diverse group of organizations, including the National Organization for Women, the National Partnership for Women and Families, The Leadership Conference on Civil and Human Rights, and many more. November 2, 2023. Dear Representative: On behalf of the 12.5 million workers represented by the AFL-CIO, the 2 million workers represented by SEIU, and the 1.2 million workers represented by the International Brotherhood of Teamsters. we write to urge you to support the National Labor Relations Board's (``NLRB'' or ``the Board'') recent final rule addressing joint-employer status under the National Labor Relations Act (``NLRA'' or ``the Act''). This important rule will ensure that workers have a real voice at the bargaining table when multiple companies control their working conditions. Accordingly, the undersigned unions strongly oppose any effort to nullify or weaken the rule, whether by legislation or resolution under the Congressional Review Act. The rule, published on October 27, 2023, rescinds the Trump NLRB's 2020 joint-employer rule and replaces it with an updated standard that is based on well-established common-law principles and consistent with recent D.C. Circuit decisions identifying critical flaws in the Trump NLRB's approach to this issue. The Board's updated rule is welcome and necessary because the Trump rule was harmful to workers' organizing efforts, inconsistent with the governing legal principles, and against the policies of the Act. The crux of this issue is simple--when workers seek to bargain collectively over their wages, hours and working conditions, every entity with control over those issues must be at the bargaining table. The Act protects and encourages collective bargaining as a means of resolving labor disputes. Collective bargaining cannot serve that purpose if companies with control over the issues in dispute are absent from the bargaining table. The Trump rule offered companies a roadmap to retain ultimate control over key aspects of workers' lives--like wages and working conditions--while avoiding their duty to bargain. This standard left workers stranded at the bargaining table and unable to negotiate with the people who could actually implement proposed improvements. Companies are adopting business structures specifically designed to maintain control over the workers who keep their businesses running while simultaneously disclaiming any responsibility for those workers under labor and employment laws. Such businesses often insert second and third-level intermediaries between themselves and their workers. These companies seek to have it both ways--to control the workplace like an employer but dodge the legal responsibilities of an employer. This phenomenon is often called workplace ``fissuring.'' Fissured workplaces, sometimes involving staffing firms, temp agencies, or subcontractors, often leave workers unable to raise concerns, or collectively bargain with, the entity that actually controls their workplace. In such arrangements, multiple entities may share control over a worker's terms of employment. For example, if employees of a subcontractor were to unionize and bargain only with the subcontractor, it might simply refuse to bargain over certain issues because its contract with the prime contractor governs those aspects of the work (e.g., pay, hours, safety, etc.). This harms workers because the entity that effectively determines workplace policy is not at the bargaining table, placing workers' desired improvements out of reach. The way to ensure that workers can actually bargain with each entity that controls their work is to readily identify such entities as ``joint employers.'' The Act requires joint employers to collectively bargain with employees over working conditions that they control. But the Trump NLRB's joint employer rule was designed to help companies with such control escape bargaining. The rule's standard for finding a joint employment relationship was unrealistic and overly narrow. It conditioned a company's joint employer status on proof that it actually exercised substantial direct and immediate control, discounting its reserved or indirect power to control a small list of working conditions. This conflicts with the governing common law principles, which make clear that a company's power to control working conditions must bear on its employer status (and thus its bargaining responsibilities under the Act) regardless of whether it has formally exercised that power. The new final rule correctly rescinded the Trump rule. Critics of the new rule claim that its joint employer standard will outright destroy certain business models or dramatically change operations. Opponents claim, for example, that companies will be required to bargain over issues they have no control over, or will be automatically liable for another entity's unfair labor practices. This is simply untrue and a further attempt to leave workers with no opportunity to bargain with controlling entities. The final rule makes it clear that a joint employer's bargaining obligations extend only to those terms and conditions within its control. And current Board law--unchanged by the rule-- only extends unfair labor practice liability to a joint employer if it knew or should have known of another employer's illegal action, had the power to stop it, and chose not to. Similarly, critics claim that the new standard imposes blanket joint employer status on parties to certain business models like franchises, temp agencies, subcontractors, or staffing firms. This is also untrue. The rule does not proclaim that all franchisors are now joint employers with their franchisees, or that any company using workers from a temp agency is automatically their employer. The particular business model used by parties in any case is not determinative. Instead, the Board looks at every case individually, and grants companies a full and fair opportunity to explain the underlying business relationship and dispute whether they control the relevant workers' essential terms and conditions of employment. The Board conducts a fact-specific, case-by-case analysis that considers whether the putative joint employer controls essential terms and conditions of employment. Make no mistake, the Board's rule may well result in the employees of a staffing firm, for example, being treated also as employees of the firm's client, but only if the client controls the employees' terms and conditions of employment. That is the only way workers can meaningfully bargain at work. But even in that situation, the workers are deemed employees only for purposes of the NLRA and collective bargaining, and the client would be obligated to bargain only about the terms it controls. It would still be up to workers to choose whether they want to organize a union and collectively bargain with their employer or employers. Nothing in the NLRB's rule alters employers' responsibilities under any other state or federal law (e.g., tax laws, wage and hour laws, or workplace safety laws) or requires any changes to business structures. But it does make clear their responsibility under the NLRA to show up at the bargaining table. The new rule is clear and commonsense: there is no bargaining obligation for an entity that cannot control workplace policies or working conditions. And for good reason--their presence at the bargaining table would be pointless. Workers have no interest in bargaining with a company that lacks the power to implement the workplace improvements they seek. This rule simply invokes a more realistic joint employer standard on par with the standard enforced during the Obama administration, allowing a company's indirect or reserved control over working conditions to be sufficient for finding joint employer status. Workers' right to collectively bargain cannot be realized if the entity that has the power to change terms and conditions of employment is absent from the bargaining table. For the reasons explained above, the undersigned unions oppose any effort to nullify the Board's rule. In particular, we urge Congress to oppose efforts to nullify the rule under the Congressional Review Act (``CRA''). Here, a successful CRA disapproval resolution would be particularly harmful: it would revert the NLRB's joint employer standard to the Trump Board's 2020 rule, which stymies workers at the bargaining table. And further, as explained above, at least one federal appeals court has strongly suggested that provisions of the 2020 rule are inconsistent with the NLRA, so litigation would likely invalidate that rule as well. This would create confusion for the workers, unions, and employers regulated by the NLRB. Not only could the two standards be nullified, leaving the Board's joint employer analysis in limbo, but the NLRB's ability to address that limbo would be unclear due to CRA limitations. The CRA provides that once a disapproval resolution is passed, the underlying agency cannot issue a subsequent rule in ``substantially the same form'' as the disapproved rule unless it is specifically authorized by a subsequent law. Thus, if the Board's new rule is nullified under the CRA, and the prior Trump rule is invalidated by federal courts, the NLRB would be limited in issuing a clarifying rule. To avoid confusion and ensure stability for workers, unions, and employers, Congress must steer clear of using the CRA to address the joint employer standard. For these reasons, we ask that you support the NLRB's joint employer rule and oppose any effort to weaken or nullify the clarified standard. Sincerely,

Mr. SCOTT of Virginia. Madam Speaker, I reserve the balance of my time.

Mr. SCOTT of Virginia. Madam Speaker, I yield 2 minutes to the gentlewoman from Texas (Ms. Jackson Lee).

Mr. SCOTT of Virginia. Mr. Speaker, I yield myself the balance of my time. Mr. Speaker, just very briefly, the joint employer rule would only weaken the critical protections for workers that congressional Democrats and President Biden have fought so hard to enact. This rule only requires that those who can control the conditions of work actually be at the bargaining table when the conditions of work are being negotiated. Without this kind of rule, employees would be stuck trying to negotiate wages with a temp agency that has no control over the wages. We have heard a lot about the franchisee situation. Mr. Speaker, I include in the Record a comment letter from the American Association of Franchisees and Dealers that points out that franchisors should be at the bargaining table if they are, in fact, controlling the conditions, as this rule provides and as the resolution would overturn. American Association of Franchisees & Dealers, Palm Desert, CA, December 7, 2022. Re AAFD Comments on Proposed Joint Employer Rule (87 Fed. Reg. 54641). Lauren McFerran, Chairman, National Labor Relations Board, Washington, DC. Roxanne L. Rothschild, Executive Secretary, National Labor Relations Board, Washington, DC. Dear Chairman McFerran and Ms. Rothschild: On behalf of the American Association of Franchisees and Dealers (``AAFD'') and its franchisee members, we respectfully offer our views and perspective on the September 7, 2022 National Labor Relations Board proposed rule that would expand the joint employer definition under the National Labor Relations Act. The joint employer debate is critical to the long-term equity ownership question of the franchised businesses. AAFD is the oldest and largest national not for profit trade association advocating the rights and interests of franchisees and independent dealer networks. The AAFD supports more than 60 independent franchisee associations and trademark specific chapters, representing thousands of franchisee operated business outlets. Since our establishment in 1992, the AAFD has focused on its mission to define, identify and promote collaborative franchise cultures that respect the legitimate interests of both franchisers and franchisees, cultures we describe as embracing our vision of Total Quality Franchising. The AAFD came into existence in response to a franchising community that has been evolving towards increasingly one-sided and controlling franchise agreements and cultures whereby franchisee equity and business ownership has been continually eroding such that many modern franchise systems have lost all vestiges of business ownership. Interestingly, instructively and importantly, we make special note that the very issues that inspired the formation of the AAFD have also given rise to the Joint Employer doctrine. For the reasons set forth below, AAFD urges the NLRB to adopt a joint employer standard that respects NRLB's decision in Browning-Ferris Industries of California, Inc., d/b/a BFI Newby Island Recyclery, 362 NLRB No. 186 (2015), and reaffirmed by the Court of Appeals for the DC Circuit, yet takes into account the unique relationships between the franchisees and franchisor needed to protect the brand. Franchisor Community Misdirection Regarding the Definition and Foundation of Joint Employment Status Franchisees respect a franchisor's ownership and control of its brand and a legitimate right to enforce system standards to protect the brand, and franchisees depend and rely on the list of benefits and support services from their franchisor. We do not believe that the many services franchisors historically provide to franchisees, and which have been disingenuously withdrawn under the `guise' of the joint employer threat are, or should be, the focus of the joint employment standard. Rather, the `test' of joint employer status should be determined based upon the amount of economic control a franchisor directly or indirectly exerts by use of the franchise agreement, operations manual, or other means, over its franchisees and which negatively impact and eviscerate a franchisee's equity ownership in the franchised business. We have specifically been asked to comment on the added economic burden placed on franchisees when their franchisor backs away from services in order to avoid Joint Employer attribution. It should be no surprise from our firm contention that franchisors unduly focus their arguments on matters of control on their legitimate interests (and we contend duties) to control and protect brand standards. As part of the franchisor's playbook to insulate itself from joint employer classification is to withdraw franchisee support of human resource services, placing an added economic burden on its franchisees. The AAFD contends that a franchisor's withdrawal of such services is a canard, indeed an integral part of the strategy to misdirect attention from the real issues and is intended to secure franchisee opposition to the joint employer doctrine. Stated simply, in the franchising context, a franchisor's provision of human resources to its franchisees should play a negligible role in determining whether the joint employer doctrine should apply to a franchisor's undue control over its franchisee's equity. We contend that the human resources services traditionally provided by a franchisor are appropriate for the protection of any brand's important standards of service, products and reputation that are properly a part of brand standards. That said, we recognize that the joint employer doctrine is built upon the traditional evaluation of master/servant and employer/employee characteristics that we believe distract from the real issues of control to subvert and diminish franchisee equity interests. We believe that much of the franchisor community is engaging in the art of misdirection in its arguments, tending to avert attention from the real economic basis for its opposition to the Browning-Ferris joint employer standard which is a bedrock of the traditional common law standard which incorporates both reserved and exercised control. The real concerns are the right to assert economic control, not the enforcement of legitimate brand standards, and include: 1. The claim that all the goodwill of the franchised business belongs to the franchisor, without any recognition of equity ownership by the franchisee whose capital and sweat equity are a major component of a franchise unit's existence and success. 2. Control over the ownership of the franchise location whereby the franchisor owns or controls the real estate which is leased or sublet to the franchisee impacting the franchisee's ownership of the business. 3. Abusive control or ownership of the assets of the business, such that a franchisee is little more than a sharecropper running the business for the benefit of the franchisor. Indeed, regarding McDonalds, it should be noted that McDonalds no longer refers to `franchisees' in its agreements. In full claim of ownership, a McDonald's licensee is referred to legally as an `operator' of a business that McDonald's fully owns. 4. The exercise of abusive control over the suppliers and supply chain of the of the operation. Far and beyond the enforcement of necessary system standards, many franchisors dictate sole sources of supply for the purpose of marking up the goods and services being purchased by franchisees, and regardless of the connection to the brand or brand standards. Franchisors now dictate where to buy insurance, process and control customer payments, and even business supplies, as well as dictating the source of brand related commodities-- all of which could be potentially purchased at lower cost from competitive sources. 5. Control over the cost of labor by setting hours of operation that are not realistic for a particular franchise unit. The Solution to the Joint Employer Dilemma We join the industry in urging the NLRB to recognize the legitimacy of protecting brand standards, and to place its definition of joint employment on the real matter of `who owns the franchised business equity.' The debate around joint employer is critical because it includes the broader debate beyond the impact of labor practices and also includes the question on who has control over the day-to-day business practices and who owns the equity in the business. We recognize that to refocus the inquiry of joint employer attribution in franchising may require some legislative revisions to the definition of `control' to the control of equity (which is not a question in the typical master servant discussion). However, we believe that our solution to provide a franchisor exemption is completely consistent with the premise of the NLRA, and within the authority of the NLRB. In establishing its test for Joint Employment, and advocating for the Browning-Ferris joint employer standard, we urge the NLRB to focus on minimum equity concerns: 1. The right to grow the business and manage its costs of operations, including the management and control of labor, goods, products and services purchased for operations. 2. The right to stay in business, to sell the business, or to transfer the business to heirs. 3. The right to manage the business finances, especially the right of the franchisor to pull funds from the franchisee's bank accounts, or whether the franchisee has the power over its own checkbook. 4. The very important, albeit sensitive, right to control the cost of supplies and suppliers. A significant promise of franchising is the power of volume purchasing, but the ability of a franchisor to dictate suppliers is fraught with the potential for abuse. A key inquiry to determine whether a franchisor has crossed the line of control over the business is whether the franchisee's interests are respected and protected where a franchisor reserves significant control over the franchisee's source of supplies. 5. Similarly, the control over the marketing budget is critical to a successful franchise system. A franchisor may control most of the marketing fund, but a line is crossed when a franchisee retains no ability to influence and direct its marketing dollars. Quite simply, the solution to the joint employer `threat' for franchise systems is to recognize franchisee equity ownership to franchisees in a sufficient amount that the franchisee is deemed to be the `owner' rather than a mere `operator' of the franchised business. The AAFD's Franchisee Bill of Rights Provides the Appropriate Tests for Excessive Control We submit the Franchisee Bill of Rights (attached), as appropriate criteria to measure and test whether a franchisor has crossed the line of excessive control. The Franchisee Bill of Rights provide fourteen indicia of a franchise system that respects the equity interests of franchisees. It is instructive to note that the Franchisee Bill of Rights actually recognize, even require, a franchisor to provide and support brand standards. Providing the expected `control' over brand standards should not be the determinative criteria for joint employer. We urge the focus on relative equity: the determination of whether the agreement and relationship fairly recognize that the franchisee has a significant equity right in the franchised business. Proposal to Create a Franchisor Exemption from Joint Employer attribution for Franchise Systems that Recognize an independent franchisee association and offer a collectively bargained franchise agreement The comparison of franchisee associations to labor unions is inevitable and appropriate. Owners of franchised small businesses organize for reasons that are similar to the reasons that employees form unions: to collectively bargain the rights and benefits of agreements of their engagement to provide services to their franchisor or employer. At its core, the National Labor Relations Act that established the NLRB was enacted to establish the right of employee groups to organize, and the NLRA recognizes important exemptions for companies that recognize unions and have a collectively bargained employment agreement that is ratified by a majority of union members and employees. AAFD urges that a franchisor that has recognized an independent owners association and has embraced a collectively bargained franchise agreement that has been ratified by a majority of franchisees should also be exempt from the consequences and penalties arising from being determined to be the `joint employer' of a franchisee's employees. In this regard, it should be noted that the AAFD has established an accreditation for franchisors that meet these tests which we label as our ``Fair Franchising Seal.'' To date, 19 brands have been accredited by the AAFD, all of which have franchise agreements that recognize franchisee rights and equity interests while reaffirming the franchisor's essential interest in protecting its brand standards. In essence, just as recognized in the NLRA, where the agreement defining rights and obligations has been collectively bargained, the reasons behind the purpose of the law have been met by the marketplace effectively doing its job! Cooperation with the Federal Trade Commission We also urge the NLRB to work closely with the Federal Trade Commission on defining aspects of the relationship that exceed normal control in a brand. The franchise industry has many unique attributes, and the FTC is the federal agency most engaged with oversight of the industry. Many items, such as uniforms and training, which are critical to the existence of the brand, are immaterial to the employment relationship, and should not create joint employer status. Conclusion The AAFD appreciates the concerns of the NLRB, with respect to creating an appropriate `test' for when a franchise system has crossed a line and become the `joint employer' of a franchisee's putative employees. We believe that many franchisors exercise so much control over the franchised business that the franchisee retains limited if any equity ownership, or control over, in the franchised business. In such circumstances it is appropriate to deem the franchisor as the joint (and sometimes even the sole) employer of the franchised business employees. But we also believe that the establishment, support and enforcement of brand standards are not the appropriate target of any control test. Rather, the inquiry should be focused on the economic rights of business ownership that is promised and expected in a franchise relationship. Fair and balanced franchise agreements and relationships that respect the Franchisee Bill of Rights will provide and meet an appropriate test for determining joint employer status. Respectfully submitted, Robert L. Purvin, Jr, Chair, Board of Trustees. Richard E. Stroiney, Chief Operating Officer and Executive Director. Keith R. Miller, Director of Public Policy and Engagement.

Mr. SCOTT of Virginia. Mr. Speaker, instead of advancing H.J. Res. 98, the House should prioritize legislation such as H.R. 20, the Protecting the Right to Organize Act, or the PRO Act, that strengthens workers' abilities to organize and collectively bargain. This resolution goes in the exact opposite direction. For those reasons, I oppose the resolution and encourage all Members to do the same. Mr. Speaker, I yield back the balance of my time.