Disco Meets “Permanent Temps”: NLRB Decides a New Joint Employment Issue

disco-297670__480On New Year’s Eve, Sister Sledge will be playing at the Seminole Casino in Coconut Creek, Florida. (You can buy tickets here.  You’re welcome.) The sisters will, of course, play the 1979 single, “We Are Family,” which is a disco song that it’s ok to admit you like. I don’t know what else they’ll play though.  It could be a long night.

“We Are Family” is also what happens when a company retains staffing agency temps for so long that they become, in that company’s words, “permanent temps.” It’s joint employment deluxe.

A recent decision by the NLRB examines what happens when a joint employer fails to apply a collective bargaining agreement to those “permanent temps.”

Orchid Paper Products Company in Pryor, Oklahoma, produces — wait for it — paper products. Their workforce is unionized and they make frequent use of staffing agency temps. The temps frequently remain on-site for long periods of time, at which point they acquire the status of “permanent temps.”

These workers are supervised and controlled by Orchid Paper, even though they are paid by their staffing firm. The Board found that under any test — Browning-Ferris or otherwise — they are joint employees.

One consequence of being a joint employee in a union environment is that the joint employer, Orchid Paper, has to follow the requirements of the collective bargaining agreement (CBA) as to those workers, even though they’re staffing agency workers. When Orchid Paper failed to follow the CBA as to those workers, it engaged in an unfair labor practice. So far, no big surprise.

The issue to be decided here, though, was the scope of the remedy that could be imposed.

As a result of an unfair labor practice, could the Board order a a remedy that held Orchid Paper to the entire CBA for its temps?

The Board said no, ruling that only certain parts of the CBA can be applied. In other words, “We Are Family, but Maybe Only Like Third Cousins.”

The Board ruled that an order intended to remedy an unfair labor practice had to be limited. The Board could only order the joint employer to apply the CBA provisions to the joint employees that related to the working conditions that Orchid Paper controlled.

My research in preparing this blog revealed that Sister Sledge, in fact, had two other Top 20 hits in 1979 — “He’s the Greatest Dancer” and “Lost in Music.” Those of you who remember those two songs will thoroughly enjoy the New Year’s Eve Show. Bring your platform soles.

© 2018 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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Amazon Users (espec. Cindy, Amy & kris), Please Don’t Submit Comments On the NLRB’s Proposed Joint Employment Rule

Joint employment rule NLRB comment period extended

Amazon has a popular feature that allows users to post questions about a product, and then anyone can then post an answer. But is that really such a good idea?

Should literally anyone be allowed to post a comment? Allow me to introduce you to Cindy C., who recently purchased an ice machine and is (I think) trying to be helpful to others who are considering purchasing the same brand of ice machine:

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Thank you Cindy. Not a helpful comment. If you decide to try the extension cord, first get out of the bathtub. Otherwise, the next post containing your name could be here.

Then there’s Amy N., who has neither Alexa nor an ounce of common sense:

6B1055D9-4CEB-45B0-A880-D540798F108A

Thank you Amy N. It’s really nice to hear from you and, best of all, now I know what to get you for Christmas!

Then there’s my favorite user comment, courtesy of kris:

8FB1A0FA-0C54-43AE-B088-8911A3FF77A6

Dear kris, we didn’t think that you did. And we still don’t. Not this thing or any other thing. You may resume finger painting.

Amazon is not the only democratic institution that invites all living, breathing creatures to provide public comments.

As we’ve written here, the NLRB is pursuing the administrative rulemaking process to craft a new definition of “joint employment.” As part of that process, there is a public comment period, during which anyone (even kris) can post a comment about the proposed rule.

So far, there have been about 8,000 comments posted, many cribbed from a cut-and-paste pro-union comment drive that invites adherents to write, “Dear _, I strongly oppose….” Many other comments, fortunately, include well-considered and thoughtful opinions, both for and against the rule. It’s the thoughtful comments that are the most helpful, kris.

The NLRB has extended the comment period through January 14, 2019, with an additional reply period through January 22 in which people can reply to a previously posted comment.

If Amy N. asks, comments may only be submitted via Alexa.

© 2018 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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What does the NLRB’s Proposed New ‘Joint Employment’ Rule Mean for Businesses?

360 degrees joint employment NLRB new rule

True story. Late 1980s. Early days of fantasy baseball. One of my high school buddies — we’ll call him The Beast — finishes last but decides he’s ready to turn things around. The Beast stands up at the next year’s draft and announces his new team name, intending to show us that he’s about to reverse last year’s standings: 360 degrees.

No one had the guts to say it. Only later did someone tell him he probably meant 180 degrees. He finishes last again. The Beast no longer plays fantasy baseball but lives a comfortable life as a tax lawyer in Florida.

A complete turnaround may now be in the works when it comes to defining “joint employment.” Recent actions by the National Labor Relations Board signal an upcoming 180-degree shift.

Click here to read the rest of the story, recently published in Westlaw’s Journal Employment and Practitioner Insights.

© 2018 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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New Definition of Joint Employment Still Appears Likely, Despite Efforts to Smack NLRB Chair in Face with an Octopus

octopus kayaker seal joint employment NLRB nature-3262715_1920

When this kayaker was slapped in the face by an octopus wielded by a seal, he just laughed it off. It didn’t seem to hurt, and I guess that’s just a thing that seals sometimes do.

Q. Now, Lebowitz, how are you going to work that intro back into something related to joint employment?

A. Watch this!

Similarly, it didn’t take long after the NLRB proposed a new regulation that would redefine joint employment (see this post) for two prominent Democrats to try to octo-seal-slap the NLRB’s Chair into backing off. Not gonna happen. The Board will not abandon its kayak.

Last week, Senator Patty Murray and Representative Bobby Scott sent a letter to Board Chair John Ring, arguing that there is “scant research or analysis” to support the Board’s call for a new joint employment standard. Um, so everything in the joint employment world has been peaches and cream? Heck, there’s so much uncertainty in the joint employment world right now that someone could devote a whole blog just to that topic!

In an effort to stall the rulemaking process, Murray and Scott asked the Board to extend the comment period on the proposed new rule by another 60 days (because no one saw this coming?) and demanded that the Board produce of all sorts of records relating to joint employment cases filed over the past several years. They also tried to re-raise concerns that there might be a conflict of interest affecting two of the three Republican Board members. The letter demanded the production of 21 categories of documents within 12 days, including asking for the name and case number of every joint employment case during the past six years fitting into various categories.

Let’s be realistic. This letter is basically outreach by Sen. Murray and Rep. Scott to labor unions, showing that they’ve got their back on the joint employment issue (to the detriment of businesses). I expect the letter will have no real effect on the process for rulemaking or on the timetable for adoption.

While few people may read that letter, the Go-Pro video of the seal smacking the kayaker in the face with an octopus has received a boatload of hits. I highly recommend watching. It is far more entertaining than this blog.

© 2018 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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Five Things You Should Know About Joint Employment

Everyone knows that two’s company but three’s a crowd. Except, of course, for Three’s Company with Jack, Janet, and Chrissy (or Cindy or Terri). But how many of you recall that one is the loneliest number that you’ll ever do? Two can be as bad as one. It’s the loneliest number since the number one. I know this because of Three Dog Night.

For musical tastes, the number four can mean Tops, Seasons, or Non Blondes.

But today’s number is FIVE.  Here are Five Things You Should Know About Joint Employment.  (click here to download the PDF.)

Five things You Should Know About Joint employment - page 1 screenshot

Five things You Should Know About Joint employment - page 1 screenshot

© 2018 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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NLRB Proposes New Definition of Joint Employer; 60-Day Comment Period Starts Now

NLRB logoWhen seeking musical inspiration for a post on the NLRB’s joint employment standard, look no further than the Barenaked Ladies’ 1994 album, Maybe You Should Drive. Like an on-again, off-again relationship, the Board keeps changing its joint employment standard. Between 2015 and today, the test has been, at various times:

  • Direct control (pre-Browning-Ferris, 1984-2015),
  • Indirect control (Browning-Ferris, 2015-Dec. 2017),
  • Direct control (Hy-Brand overrules Browning-Ferris, Dec. 2017-Feb. 2018), and
  • Indirect control (Board vacates Hy-Brand, restoring Browning-Ferris, Feb 2018-present).

But with this newest change coming in the form of a proposed regulation, the proposed change can be expected, once it’s enacted, to remain in effect long term.

Cue the Barenaked Ladies, in “Everything Old Is New Again” (1994):

Everything old is new again, everything under the sun.

Now that I’m back with you again,

We hug and we kiss, we sit and make lists,

We drink and I bandage your wrists.

The proposed new standard would make it much more difficult to establish that a business is a joint employer.

The new test will help franchisors, who need to protect their brand and marks, but do not exercise day-to-day control over hiring and scheduling of a franchise owner’s employees. The new test will help businesses that subcontract labor and that want to ensure certain tasks are performed but do not exercise day-to-day control over how the work is performed or over how subcontractor hires, schedules, and supervises its employees.

In a Notice of Proposed Rulemaking released late last week, the NLRB proposes a new regulation to interpret the National Labor Relations Act. New 29 CFR §103.40,which would define joint employer.

Under the proposed regulation, an employer may be considered a joint employer of a separate employer’s employees only if the two employers share or codetermine the employees’ essential terms and conditions of employment, such as hiring, firing, discipline, supervision, and direction. A putative joint employer must possess and actually exercise substantial direct and immediate control over the employees’ essential terms and conditions of employment in a manner that is not limited and routine.

There’s a lot packed into that definition:

  • The proposed joint employer must share or codetermine the workers’ terms and conditions of  employment;
  • These terms have to be essential terms of employment, such as hiring, firing, discipline, supervision, and direction;
  • It is not enough to have the right to control these terms; the proposed joint employer must actually exercise this control;
  • The control must be direct, substantial, and immediate; and
  • It is not sufficient to exert control that is limited and routine.

“Limited and routine” control means directing another business’s employees as to what work to perform, or where and when to perform it. Under the new rule, that will not be enough to show joint employment. Control that is not “limited and routine” would include providing direction on how to do the work — in other words, supervision.

For those of you asking, “So what? Who cares?” (my parents, for example), here’s why the change matters.

Under the new rule, a business that retains another company to perform work but has no control over that company’s hiring, compensation, scheduling, or supervision:

  • Will no longer be obligated to collectively bargain with that other company’s unionized workers;
  • Will no longer be held jointly liable for that other company’s unfair labor practices; and
  • Will no longer be drawn into collective bargaining or unfair labor practice disputes with that other company’s employees.

It’s a big deal. Unions won’t like it since the new rule will reduce their influence, but the new rule is a common sense, pro-business proposal that will add predictability and certainty to economic and legal relationships.

So what’s next?

There is a now a 60-day period for comment. The Board will then have the opportunity to consider the comments and revise or reject the proposed rule.  The soonest the rule can be implemented is late 2018 but more likely early 2019.

Then, assuming the rule is implemented, we go back to the standard that existed before Browning-Ferris, but with a lot more clarity and permanence. Everything old is new again. But this time, the change should be long-term since it will be memorialized in a  federal regulation.

© 2018 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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Is It Legal to Subcontract Out Union Work? (Ask a Song Title)

Subcontract union workI like similar but contradictory song titles. Pink Floyd has Wish You Were Here. But REO Speedwagon has Wish You Were There.

For one Puerto Rican company in the injection-molded products business, the message to its union was Wish You Were Gone (that’s Cosmo Pyke, 2017).  The company decided to outsource a portion of its injection mold production to a subcontractor but otherwise stayed in the business. The union filed an unfair labor practice charge.

The union won. The NLRB recently ruled that the company could not subcontract out work that had traditionally been performed by the union — at least not until the company had bargained over it and reached impasse. The Board ruled that once the union is performing a certain kind of work, a company’s decision to reconsider who performs this work is a mandatory subject of bargaining, so long as the company was remaining in the business. (The result likely would have been different if the company was getting out of that line of work.)

The Board noted that the company “remained an active participant in the production of injection-molded products, owned the machinery that manufactured the product, and continued to sell the product directly to the customers it served prior to its transfer of production to Alpla [the subcontractor].”

The moral of the story here is that — whether you wish the union were here, there, or gone — you need to bargain with it before subcontracting out its work. Exceptions may apply, depending on the facts and circumstances, but be cautious.

© 2018 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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