NLRB Proposes Change to Joint-Employer Standard

September 13, 2018
Tomorrow, the National Labor Relations Board will be publishing a proposed rule that would roll back the controversial “joint employer” definition contained in the NLRB’s 2015 Browning-Ferris decision. This is the latest move in the long-running saga to bring the Board’s position on joint employment to rest.

Background

In its 2015 decision in Browning-Ferris, the NLRB reversed decades’-long precedent and held that direct control was not needed for a contractor to be considered a joint employer.  In December 2017, with a Republican majority in place, the NLRB reversed Browning-Ferris in Hy-Brand.  But in February 2018, the Board was forced to vacate Hy-Brand after the inspector general found that one NLRB member (William Emanuel) should not have participated in the Hy-Brand decision because his former law firm had been a litigant in Browning-Ferris.  As a result, the Browning-Ferris standard remained intact.  In May 2018, the NLRB announced it was considering rulemaking as the joint-employer definition it would use.  (For more information, select the “NLRB” tag from the drop-down menu on the right-hand side of this blog.)

The Proposed Rule

On its website today, the NRLB said that under the proposed rule, “An employer may be found to be a joint-employer of another employer’ employees only if it possesses and exercises substantial, direct and immediate control over the essential terms and conditions of employment and has done so in a manner that is not limited and routine.  Indirect influence and contractual reservations of authority would no longer be sufficient to establish a joint-employer relationship.”  The proposed rule would thus unwind the Browning-Ferris decision.  The NLRB further stated that the proposal “reflects the Board majority’s initial view, subject to potential revision in response to public comments, that the National Labor Relations Act’s intent is best supported by a joint-employer doctrine that does not draw third parties, who have not played an active role in deciding wages, benefits, or other essential terms and conditions of employment, into a collective-bargaining relationship for another employer’s employees.” 

Comments Period.
Comments on the proposed rule are due 60 days from the scheduled date of publication, September 14, 2018.

NLRB