On October 21, 2014, National Labor Relations Board (NLRB or Board) Associate General Counsel, Barry J. Kearny, discussed the litigation, currently before the Board, on the joint employer issue. Kearny predicted that the Board will issue its decision very soon.
In the case before the Board, Browning-Ferris Industries of California Inc., the NLRB General Counsel, Richard F. Griffin, asks the Board to abandon the 30-year-old standard for determining whether multiple organizations should be treated as joint employers and therefore jointly liable for the unfair labor practices and union obligations of each other.
Under the existing standard, in order to find a joint employer relationship, it must be demonstrated that organizations have “direct and immediate control over employment matters.”
The General Counsel urges the Board to adopt a new standard and construe employer status under labor law “broadly in light of economic realities.” Under this new standard, any entity that “wields sufficient influence over the working conditions” of the employees would be an employer of said employees, even if it does not have direct and immediate control over employment matters.[1]
To say the least, this change, if adopted by the Board, would significantly expand the entities that would be liable for unfair labor practices and that would have obligations for union recognition and under union agreements. The remedial reach of the NLRB would grow exponentially. The general/subcontractor relationship in the construction industry would be significantly impacted.
Although Mr. Kearny would not predict whether the Board would adopt the test urged by the General Counsel in Browning-Ferris, he said that a majority of the current board members have stated that they do not think very highly of the current joint employer standard.
[1] Under the new standard the Board would look at whether the following factors are present with respect to the various putative employers: (a) track data on labor costs; (b) calculate labor needs; (c) set policy on work schedule; (d) track wage reviews; (e) track time needed for employees to accomplish given tasks; (f) handle employment applications through their own system; (g) impose safety rules; and (h) impose hygiene/appearance (uniform, etc.) rules.
