A recent court decision has added new pressure on the National Labor Relations Board to develop a joint-employer standard that allows employers a reasonable level of control over their relationships with providers of contract labor.
THE LAW The National Labor Relations Act regulates labor organizing for both employees and employers. It provides a framework for union elections and collective bargaining. It applies to both unionized and nonunionized workplaces.
The National Labor Relations Board interprets the act as it applies to specific employer-employee disputes. NLRB decisions interpreting the NLRA determine the finer points of labor relations, including what constitutes a joint employer.
Before 2015, the NLRB had held that a joint-employer relationship existed when "two separate entities share or codetermine those matters governing the essential terms and conditions of employment."
The employer had to "meaningfully affect matters relating to the employment relationship such as hiring, firing, discipline, supervision and direction." The employer's control had to be "direct and immediate."
Then in 2015, the NLRB's decision in Browning-Ferris, Inc. attempted to update the interpretation to keep up "with changing economic circumstances" including "the dramatic growth in contingent employment relationship[s]."
Browning-Ferris recognized even indirect employer control in a joint-employer relationship. This is significant because joint employers can be forced to bargain with unions and may be liable to charges of unfair labor practices under the NLRA.
WHAT'S NEW Once Republicans gained a majority on the NLRB following the 2016 election, the board overturned Browning-Ferris with its Hy-Brand International decision. But the NLRB's inspector general ruled that one of the Republican board members, William Emanuel, should have recused himself because his law firm represented Hy-Brand International.
A panel of two Democrats and one Republican overturned Hy-Brand International, reinstating Browning-Ferris.
Meanwhile, the employer in Browning-Ferris appealed to the D.C. Circuit Court of Appeals. The NLRB asked the court to decide the issue even though it was developing a new rule reverting to the previous "direct and immediate control" standard.
When the court issued its decision in late 2018, each side had something to cheer about and something to boo. The court said indirect control could be a factor in determining whether a joint-employer...