Browning-Ferris Joint Employer Status Case Update

The public at large is still waiting for a decision from the D.C. Circuit Court of Appeals on whether the National Labor Relations Board’s (NLRB) ruling in 2015, which changed the definition of joint employer, will be upheld. On March 9, 2017, Browning Ferris Industries (BFI), the NLRB, and the Union presented oral arguments to the D.C. Circuit Court.

The circuit judges involved include Patricia Millet, Raymond Randolph, and Robert Wilkins. Former President Obama appointed Millet and Wilkins, and George H. W. Bush appointed Randolph.

Over the past 30 years, joint-employer status was only granted in cases where companies expressed “direct” and “complete control” over employees. The 2015 NLRB ruling changed this precedent when it switched from “direct” exertion to concepts of “reserved” and “indirect” control. The ruling made the line between “influence” and “indirect” blurry. In this regard, a significant portion of the questions presented by the judges revolved around getting a handle on what “indirect” control means.

BFI presented arguments that for years law has dictated joint employer status was determined by focusing on “active” control of employees.

Various examples were presented by the judges to try to drill down the definition of “indirect” control. One example included a hotel, which could hire a landscaping company to tend to its landscaping needs. The question presented was if the hotel was not happy with the landscaping company’s workers’ performance, and they directed the supervisor to conduct their workers’ jobs in a different manner – would this be considered as joint employer status on the conditions of “indirect” control? A second example thrown into question to assist in defining “indirect” was about a restaurant that could hire an exterminator, but direct them to only come after hours. Would this be classified as “indirect” control?

In this vein, Judge Millet made it clear that the NLRB had not provided practical examples of how the new test would be applied going forward. Ultimately, the definition of “indirect” was still left very much open.

The judges also attempted to create a clearer picture by asking questions regarding bargaining obligations. How would a company know which subjects they were required to bargain over with a union? The Union’s response largely implied that any request whether general or specific is a subject about which companies are required to bargain. Questions about at-will contracts also arose. Would at-will contracts initiate bargaining obligations? The Union’s response to this question was probably yes.

In the end, it is still unclear and hard to predict what the final decision surrounding joint-employer status will be. The wording of the judges’ decision will play a very important role in determining if the NLRB’s ruling will be the new precedent, and how much wiggle room the board will have from the Browning-Ferris standard it implemented.

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