On Sept. 14, the National Labor Relations Board published a proposed rule that would establish an updated standard for determining joint-employer liability under the National Labor Relations Act. 

According to an NLRB press release, the proposal aims to foster predictability, consistency and stability in the determination of joint-employer status, and therefore clarifies the standard in a way that promotes meaningful collective bargaining and advances the purposes of the NLRB. 

Under the proposal, an employer may be found to be a joint employer 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. The “essential terms and conditions of employment” that establish a joint-employer relationship include the ability to hire, fire, discipline, supervise and direct employees of a second employer, according to an analysis published by ABC’s General Counsel, Littler Mendelson P.C.

The analysis also discusses the significance of understanding an employer’s joint-employer status, saying it can affect bargaining with a union representing jointly employed workers, joint and several liability for unfair labor practices committed by the other employer and labor picketing.

ABC plans to submit comments to the NLRB. The public may submit comments on the proposed rule here; the deadline for submitting comments is Nov. 13. 

Background

On Aug. 27, 2015, the Obama NLRB issued a decision in Browning-Ferris Industries, which uprooted more than 30 years of precedent and greatly expanded joint-employer liability under the NLRA. The decision imposed unnecessary barriers to and burdens on contractor and subcontractor relationships throughout the construction industry.

In December 2017, however, the Trump NLRB attempted to reverse BFI in the Hy-Brand case. Unfortunately, in February 2018, the board vacated the Hy-Brand decision for procedural reasons. Thus, BFI is once again the NLRB standard. 
 
ABC has been a vocal opponent of the expanded definition of joint employer, and has supported legal and legislative efforts to restore the standard that was in place for more than 30 years.