New Board Restores Proper Joint Employer Test

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Sherman & Howard L.L.C.

Last week the newly constituted Trump Board overruled the Obama-era joint employer test that has caused confusion and legal uncertainty for many employers. Hy-Brand Industrial Contractors, Ltd. The Board’s test in the much criticized Browning-Ferris Industries case was that “direct and immediate” control was not necessary to establish that two employers were “joint employers.” Rather, so long as there was the mere existence of reserved joint control, joint employer status could be found. This test caused problems for franchise relationships, determining which employer had a bargaining obligation, and whether a secondary boycott existed. The Trump Board overruled Browning-Ferris and returned to the direct and immediate control test. Return to the old test should again provide employers with the clarity necessary to determine their legal standing and obligations.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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