Ding-Dong, the Witch is Dead! NLRB Overrules Browning-Ferris

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Remember the good old days, way back in 2014? You recall the time — back when David Letterman was still on the air and it was not yet illegal in New York to take a selfie with a tiger.

Yes, that was life before 2015, when the NLRB waved its magic wand, rewrote the definition of joint employment, and forced several of the planets to spin out of orbit. The Board’s decision in Browning-Ferris erased decades of precedent and caused bloggers everywhere to vomit profuse amounts of text and doomsday predictions.

For those of you who missed the news in 2015 (understandable if you spent the year focused on following the saga of Winston, the Aussie python who swallowed salad tongs), allow me to offer this quick refresher: The 2015 Browning-Ferris decision declared that, under federal labor law, a business would be considered a joint employer if it retained the right to exercise even a teeny tiny bit of control, and even if it never actually exercised that control.

Good news, citizens of earth! The planets realigned on Thursday, when the Board reversed its 2015 decision and reverted back to the old standard. The new standard is the old standard. (Got it?)

Effective December 14, 2017, here is the standard for determining joint employment under the National Labor Relations Act:

For all these reasons, we return today to pre-Browning-Ferris precedent. Thus, a finding of joint-employer status shall once again require proof that putative joint employer entities have exercised joint control over essential employment terms (rather than merely having “reserved” the right to exercise control), the control must be “direct and immediate” (rather than indirect), and joint-employer status will not result from control that is “limited and routine.”

From today forward (or at least until the next administration reconfigures the Board and they go back to the old-new-old Browning-Ferris standard), businesses will not be deemed joint employers under the NLRA unless (a) they actually exercise control, (b) the control they exercise is over essential employment terms, and (c) the control is direct and immediate. Here is the decision, titled Hy-Brand Industrial Contractors.

This is a practical, workable standard, just in time for the holidays. Thank you, Santa.

Now if only we could get Pluto back on the roster of planets.

© 2017 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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Be Kind, Rewind: Here’s Why the Browning-Ferris Joint Employment Standard Is Going to Be Reversed

AF6DB19D-A636-4AB4-BFA8-7D592D57137FRemember when you used to go to the video store to rent VHS tapes and there was that little sticker on the tape cheerfully reminding you to “Be kind! Rewind!”  I know, half of you have no idea what I am talking about, but there used to be these things for watching movies before Netflix — no, not DVDs, before that — no, no, not cave drawings, after that.

Anyway, take my word for it. The point was, when you were done with your movie, you were supposed to rewind the tape so the next viewer could start over, back at the beginning of the film. It was the courteous thing to do.

With last week’s confirmation of Peter Robb as the new General Counsel of the NLRB, the pieces are now in place for a rewind of the 2015 Browning-Ferris joint employment decision, which made it much easier under federal labor law to find joint employment. The 2015 decision changed the standard so that indirect and tangential control was sufficient to establish a joint employment relationship, rather than the previous standard requiring a more direct exercise of control.

The changed standard was a product of two factors: (1) a majority-Democratic, pro-union NLRB, and (2) a Democratic, pro-union NLRB General Counsel. A few weeks ago, the NLRB was reconstituted to bring back a Republican majority. Last week, a new General Counsel was confirmed. To overstate how this works, the General Counsel decides which cases to bring to the Board. The Board then decides those cases.

With these two recent developments, it’s almost time to Be Kind (to Businesses) and Rewind, back to the pre-2015 joint employment standard.

It will take some time, but it now seems almost inevitable that at some point during the next couple of years, the right case will be brought to the Board (courtesy of Mr. Robb), and the new Republican-majority Board will vacate the 2015 standard and return to the requirement that direct control must be shown before a business can be deemed a joint employer under federal labor law.

It’s too early right now for businesses to disregard Browning-Ferris. For now, it’s still the law, and Administrative Law Judges are likely to follow it (although that too may change, with the Browning-Ferris decision currently on appeal).

Anyway, stay tuned for further developments. And meanwhile, please fix the blinking green “12:00” on the face of your VCR.

© 2017 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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NLRB Shifts to Republican Majority; Change in Joint Employment Doctrine Is Likely

NLRB joint employment william emanuelWatching the National Labor Relations Board is like riding a see-saw (a very slow one, and not a very fun one, but stay with me here).

Board members serve five-year terms and, when they expire, the President has the right to appoint a successor, with confirmation by the Senate. Predictably, under Democratic administrations, the Board tips toward union workers’ rights, and under Republican administrations, the Board tips toward protecting businesses.

With the late September confirmation of William Emanuel to the Board’s fifth (and tie-breaking) seat, the see-saw tipped back toward the side of protecting businesses.

Emanuel joins the Board from a defense firm that represents many large companies in labor disputes. Firms that represent companies in labor disputes typically do not also represent employees because doing so would create philosophical conflicts between the firm’s clients. You’d be arguing to interpret the law one way for an employee client, then another way for an employer client. Emanuel’s background therefore, has been pro-business.

As I wrote here, that background caused several Democrats to express concern. It was little surprise, then, that he was confirmed by a partisan vote of 49-47, winning by a safety when the Democratic quarterback was sacked in the end zone late in the fourth quarter.

Emanuel joins Republicans Philip Miscimarra and Marvin Kaplan, giving Republicans a 3-2 majority on the Board for the first time in almost 10 years.

The Board does not decide which cases to bring. The NLRB General Counsel does that. But the Board acts as the main decision-making body for labor law disputes, with its decisions appealable to the U.S. Courts of Appeal.

One of the Board’s most controversial decisions in the past five years was the Browning-Ferris decision in 2015, which drastically lowered the bar for finding joint employment in a relationship. You know those playground monkey bars you used to have to jump to reach? The Board lowered those to knee level. You’d have to limbo to get under them. They are no fun to play on. Under the new standard, a business can be a joint employer even if it exerts only indirect and minimal control. You can read more about that decision here.

The Browning-Ferris case is currently under appeal in the D.C. Circuit Court of Appeals. It might be affirmed, might be reversed. But here’s what you should remember: The NLRB tends not to follow the rulings of the U.S. Courts of Appeals. The NLRB’s decisions cover all 50 states, but each Court of Appeals covers only a handful of states, and so its rulings do not have widespread reach.

So no matter what the Court of Appeals does in Browning-Ferris, the NLRB is likely to continue to apply the standard it wants to apply. Under the Obama Board, that standard was to lower the monkey bars to your knees. Under the new Board, the standard for finding joint employment is expected to be raised back up to the point where you can swing freely from bar to bar without your feet ever touching the mulch below. The new Board is likely to re-establish the old joint employment standard, in which more direct control over workers is required for a finding of joint employment under federal labor law.

This change won’t happen right away. It may be a while before the right case gets to the new Board and the new Board has the opportunity to change course. But it is expected to happen.

Employers concerned about being tagged as joint employers for labor law purposes should remain cautious and continue to follow developments. Even if the labor law standard changes, though, there are still different tests for joint employment under different laws, so a change will have limited effect. For now, the indirect Browning-Ferris standard remains in place, but probably not for too much longer.

© 2017 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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Appeals Court Slams NLRB Joint Employer Finding in Landmark CNN Case, But Ruling May Prove Hollow

NLRB CNN joint employment Browning-Ferris overrule Second Circuit Court of Appeals IMG_1094A federal Court of Appeals has ruled that the NLRB cannot abruptly change its definition of joint employment without sufficient explanation. This decision (the CNN case) rebukes the NLRB for its initial attempt, in 2014, to expand the definition of joint employment.

This decision does not, however, address the Browning-Ferris case that followed in 2015, in which the Board similarly expanded the definition of joint employment but, that time, with an expansive explanation and justification for doing so. Browning-Ferris in on appeal too.

Here’s what happened.

Back in the good old days, when TV was pure and the world had not yet been exposed to Janet Jackson’s halftime nipple, CNN used to contract with an outside company who supplied technicians for its TV production. CNN’s camera operators, sound technicians, and broadcast engineers were employees of a third party, and they were represented by a union.

In late 2003, just a few months before that fateful Super Bowl wardrobe malfunction, CNN decided to bring that work in house. It set up a hiring and interview process and then directly hired its own technicians, severing its ties with the third party.

That made the union mad.

The union claimed the decision was motivated by anti-union animus and filed an unfair labor practice charge. The NLRB ultimately agreed with the union, determined that CNN was a joint employer of the third party technicians, and therefore had to respect the union status of the technicians. CNN could not hit the reset button without bargaining.

There was more to the decision too, with findings of anti-union statements by supervisors and a question about whether CNN was a successor employer (which is not the same thing as being a joint employer), but for our purposes, let’s focus on the joint employment piece.

Before the Board’s CNN decision, the legal standard for joint employment under the NLRB (remember, different laws have different standards) required “direct and immediate control.” In the CNN decision, the Board inexplicably abandoned that standard and ruled that two separate entities are joint employers of a single workforce if they “share or codetermine those matters governing the essential terms and conditions of employment.”

“Share or codetermine” is much looser than “direct and immediate control.” Think of your teenage children. You may try to “share and codetermine” whether they have a party at your house when you are out of town on business, but you have no “direct and immediate control” over the matter. At least not while it happens. (Purely hypothetical. My kids didn’t do this. Kids, if you are reading, DON’T do this!)

This case has been crawling through the courts for years, but finally last week, the Second Circuit Court of Appeals ruled that the NLRB could not simply switch the test without explaining itself. On that basis alone, the Court rejected the conclusion that CNN was a joint employer of the third party technicians.

So what does this mean for Browning-Ferris and the vastly expanded definition of joint employment that the Board instituted in that case?  Unfortunately, nothing.

In contrast to the CNN case, the Board’s Browning-Ferris decision included a lengthy and expansive discussion of the joint employer standard and why the Board — like in Sympathy for the Devil, “saw it was a time for a change.”

The Browning-Ferris case is also on appeal in the Second Circuit Court of Appeals (the same appellate court that just issued this decision) but will be heard by a different panel of three judges. A decision in that case is expected in the next several months.

For now, the Browning-Ferris standard — that indirect control is enough to demonstrate joint employment — remains the standard used by the NLRB.

© 2017 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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New NLRB Nominations May Lead to New Joint Employment Test (or to my misuse of Lynyrd Skynyrd song lyrics)

IMG_1088In the Lynyrd Skynyrd song, “Gimme Three Steps,” we find our hero cutting a rug down at a place called The Jug with a girl named Linda Lou. This catchy song has nothing to do with labor law but does deal with someone who finds himself in a bad situation (shakin’ like a leaf on a tree!) and needs three steps to get out the back door.

Same thing here (in a sense). [C’mon, work with me here, I’m trying to make NLRB appointments interesting!]. When not posting tweets of himself pummeling a photoshopped CNN logo outside a WWE ring, President Trump found the time to make two important nominations to fill vacancies on the National Labor Relations Board (NLRB), giving companies two of the three steps needed to undo a long list of anti-business decisions from the past eight years.

The two new appointmnents, once confirmed, will shift the Board back to a 3-2 Republican majority, which should spell relief for businesses in several areas — including joint employment. (Two appointments = two steps. There’s a third step coming.  Wait for it….)

Nominee William Emanuel is a long-time employment defense lawyer who has made a career out of representing companies in labor disputes.

Nominee Marvin Kaplan is currently counsel to the Occupational Safety and Health Review Commission, an independent federal agency that rules on disputes over OSHA citations. He has served nearly a decade in various federal roles, including as Bush 43’s assistant secretary of labor for administration and management at the DOL.

Once confirmed, Emanuel and Kaplan will join current members Philip Miscimarra (R), Mark Gaston Pierce (D), and Lauren McFerran (D).

The rightward shift in the Board will likely bring relief to employers on a number of important labor issues, including the test for joint employment under the National Labor Relations Act (NLRA).

The Board’s landmark 2015 decision in Browning-Ferris (currently under appeal) redefined the test for joint employment, deeming workers to be joint employees under federal labor law even when a company exercises only minimal and indirect control over their working conditions. The reconstituted Board is likely to revert back to the prior joint employment standard, which required more direct control over how, when, and where work was performed before a company could be deemed a joint employer. (Of course, the D.C. Circuit Court of Appeals may take care of that itself by reversing the Browning-Ferris decision on appeal. A decision is expected before the end of the year.)

Meanwhile, one significant hurdle remains.  (As promised, loyal reader, here’s the third step.) The term of the NLRB’s General Counsel, Richard Griffin, does not expire until November 2017. As General Counsel, Griffin acts as the NLRB’s Chief Prosecutor. When his term expires, the appointment of a new General Counsel with a more pro-business outlook is expected.

The combination of two appointments to make a more pro-business Board, plus a more pro-business General Counsel, should finally bring relief to employers who have been battered by eight years of anti-business interpretations on issues like union elections, handbook policies, and social media. These rulings have been applied to union and non-union businesses, and so a more pro-business Board will be a welcome change to the business community.

Of course, it will take time for businesses to see the effects of a new Board and, later, a new General Counsel. The right cases and circumstances will need to arise, and then more pro-business interpretations can be issued. I blogged about this topic here a few few months ago, before we knew who the two new NLRB nominees would be. With the President’s two June 2017 nominations, we are two steps closer to these changes taking full effect.  (“That’s the break I was looking for.”)

Thank you, Ronnie Van Zant and Allen Collins, for helping me to try to make this blog post interesting and, most of all, for naming your band after a gym teacher.

© 2017 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.

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Joint Employment Update: What’s The Status of Browning-Ferris and the NLRB?

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In August 2015, the NLRB rewrote the book on joint employment, declaring in the Browning-Ferris case that the right to exercise minimal control, even if not actually exercised, was enough to create a joint employment relationship.  (Read more here.) Previously, joint employment under the National Labor Relations Act (NLRA) required the actual exercise of a meaningful level of control.

But what’s happened since then? What happens next? What should employers expect in 2017 regarding joint employment under the NLRA?

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