Skip to main content

NLRB Overrules Browning-Ferris Joint Employer Decision


Earlier this month, the National Labor Relations Board ("NLRB") overruled an Obama era NLRB decision, Browning-Ferris Industries of California, Inc., that expanded the definition of joint employer and placed a larger number of employers on the hook for labor law violations that were committed by their subcontractors.  In the NLRB's 3 - 2 decision in Hy-Brand Industrial Contractors, Ltd., a "traditional" test will now be applied when considering whether an employer is jointly liable with a subcontractor for a labor law violation.  Under the traditional test, it must be shown that the employer had direct and immediate control over essential employment terms to support a finding that multiple entities (the employer, a subcontractor, etc.) are joint employers. 

For those unfamiliar with Browning-Ferris, the joint employer tests, etc., this has been a somewhat hot button issue since the Browning-Ferris decision was issued in 2015.  In that decision, issued during President Barack Obama's administration, joint employer liability could be established by showing proof of indirect control, contractually reserved control that had never been exercised, or control that is limited and routine.  Since the Browning-Ferris decision was issued, Republicans and pro-business groups have railed against the new "indirect control test" and claimed that it created uncertainty in day to day operations of many businesses.  An appeal had been filed with the D.C. Circuit Court of Appeals to appeal the NLRB's 2015 decision (although with the NLRB's decision in Hy-Brand Industrial Contractors, Ltd., the Court remanded the case back to the NLRB on December 22nd...in effect rendering the appeal moot.)  

Perhaps in an effort to circumvent future NLRB decisions that could undermine Hy-Brand Industrial Contractors, Ltd., Republican backed legislation was introduced in Congress recently which sought to reverse the decision and permanently change the definition of "employer" as defined in the National Labor Relations Act and the Fair Labor Standards Act.  The legislation, the Save Local Business Act, has managed to clear the House and is now under consideration in the Senate.  With a Republican controlled Congress (at least through the mid term elections next year), it appears that if Republicans can rally around this legislation, they could manage to pass it without any Democratic support.



Comments

Post a Comment

Popular posts from this blog

NLRB: Discussion Among Employees About Tip Pooling is Protected Concerted Activity

  This Advice Memorandum from the National Labor Relations Board’s Associate General Counsel, Jayme Sophir, addressed whether employees which discussed and complained about tip pooling at work constituted protected concerted activity. In relevant part, an employer in New York operated a chain of steakhouses.  While tip pooling was in place at these steakhouses, some of the employees objected to it on the grounds that it was not transparent and improperly divided tips among the workers.  Employees were told not to complain or talk to each other about the tip pool and were told that doing so would endanger their jobs.  Despite the employer later attempting to provide some clarity as to how the tips were being divided, rancor still existed among some employees.  At one point, the employees were told by a general manager that some employees that had been talking about the tip pool were “cleared out” and the employer would continue to do so. In the Advice Memorandum,...
Post a Comment
Read more

Utah Non-Compete Bill Falters in House

Last month, a non-compete bill sponsored by Representative Brian Greene (Republican from Pleasant Grove) & up for vote in the Utah House failed to make it through the Legislature.  The bill sought to ban enforcement of non-competes if they came after a worker was already employed, given no compensation (such as a bonus or promotion) for signing the non-compete, and laid off within six months.  However, by a 22 - 49 vote, the bill was resoundingly defeated after some business groups lobbied to kill the non-compete bill.  One group in particular, The Free Enterprise Utah coalition, argued that the Utah State Legislature should hold off on any changes to non compete laws in the state until a survey about non competes was done among Utah businesses.  Representative Greene had countered this claim and argued that a survey was not needed to show that the current non compete laws in the states allowed many businesses, including some small high tech companies i...
Post a Comment
Read more

What I've Been Reading This Week

Recently, Equal Employment Opportunity Commission Commissioner, Chai Feldblum, had her re-nomination on the brink, after Utah Republican Senator Mike Lee took steps to block it .  Readers might have heard that late last week, Commissioner Feldblum's re-nomination quietly slipped away and she tweeted out a thank you to supporters and friends, acknowledging that her time at the EEOC was over.  While there has not been much in the way of a further update in regard to that ongoing saga, we wait to see how things will play out at the EEOC, now that it has lost a quorum until additional Commissioners are confirmed by the Senate. For the time being, there are other developments for readers to review this week.  In particular, I call attention to the article on managing a wage & hour audit by the Department of Labor as well as steps an employer can take to better ensure compliance with the ADA. As always, below are a couple articles that caught my eye this week. ...
Post a Comment
Read more