Since 1984, the National Labor Relations Board has used the same standard to evaluate whether two separate companies are joint employers for purposes of the National Labor Relations Act. Under this standard, two separate companies are joint employers if they share or codetermine matters governing the essential terms and conditions of employment. TLI, Inc., 271 NLRB No. 128 (1984). More specifically, the joint employer must meaningfully effect matters related to the employment relationship, such as hiring, firing, discipline, supervision and direction. Laerco Transportation & Warehouse, 269 NLRB 324 (1984).
However, the Board has recently taken actions that may signal its intention to lighten that standard and make it easier for unions and employees to prove that two companies with a business relationship are one employer under the eyes of the law.
Most recently, the Board’s General Counsel announced that his office would charge McDonald's USA, LLC as a joint employer for the alleged unfair labor practice is of its franchisees – despite the fact that McDonald's has little to no direct control over its more than 13,000 U.S. franchisees. While those cases are in very early stages, the Board is currently considering a case that it could use as a vehicle to change the standard for the General Counsel to further pursue McDonald's and other companies as joint employers.
In May, the Board requested amicus briefs, or legal analyses from interested unrelated parties, in Browing-Ferris Industries of California, Inc., Case 32-RC-109684. In this case, the Board ALJ rejected the Teamsters’ argument that BFI was the joint employer of employees of Leadpoint, an independent contractor supplying workers and services at a BFI recycling facility. On review, the parties dispute whether the union (and union amici) are attempting to change the well-established joint employer standard. Indeed, the union urges the Board to ‘return to a broader standard’ that finds that control necessary to determine joint employer status need not be “direct and immediate.” Not surprisingly, the General Counsel also filed an amicus brief advocating a broader standard.
The briefing process is complete, and, considering the fact that the Board’s Democratic majority voted to review the Teamster’s appeal, an expansion of the joint employer standard may be imminent. Consequently, companies with contractual and business affiliations should watch for the Board’s decision because it certainly could impact how to evaluate the relationships of those companies for the purposes of determining union representation and defending unfair labor practice claims. Moreover, as the Board continues to attempt to increase its influence on union-free workforces, as well, a broader joint employer standard could impact employer’s policies and procedures and the day-to-day terms and conditions of employment.
Should you have any questions regarding this article or any other employment or labor matter, please contact Erin Elizabeth Magee of Jackson Kelly PLLC at (304) 340-1360.