Late last week the NLRB issued its long awaited decision in Browning-Ferris Industries – drastically expanding who may be considered a “joint employer” under the National Labor Relations Act (NLRA).
In Browning-Ferris, the company (“BFI”) had contracted with a labor services company – Leadpoint – to provide workers for BFI’s recycling plant. The Leadpoint employees were hired and supervised by Leadpoint supervisors. Their schedules were set by Leadpoint schedulers. Any discipline was determined by Leadpoint managers. However, under its contract with Leadpoint, BFI set requirements for candidates and retained the right to refuse or discontinue use of any employee. Also, because of how the facility worked, BFI set the hours for the various shifts (though Leadpoint determined which workers would work each shift).
The Teamsters decided to organize the Leadpoint workers at the BFI facility. However, instead of filing their petition for representation solely with regard to Leadpoint, the Teamsters filed their petition also naming BFI as the employees’ employer, on the theory that Leadpoint and BFI were joint employers and, as a result, that BFI could be required to negotiate the union.
The Board agreed with the Teamsters, holding that BFI was a “joint employer” of the Leadpoint employees. As a result, the union was permitted to move forward with its petition.
In its decision, the NLRB rejected the prior test for joint employment – which required that an entity not only possess the authority to control employees’ terms and conditions of employment but also exercise that authority in a meaningful manner – and set a new rule: that indirect or reserved authority, even if not exercised, can be sufficient to establish a joint employment relationship.
This ruling is particularly important for companies that work with subcontractors or staffing firms, or are themselves contractors or staffing firms. Contracts governing staffing and subcontractor relationships regularly include provisions setting minimum standards for the individuals performing the services, the right to refuse workers or discontinue their use, and other requirements relating to the individuals who are performing the services. There are strong business reasons to include these provisions, but, in light of the Board’s ruling in Browning-Ferris, companies need to be aware that the provisions which keep control over these aspects of the relationship also open the possibility that the company receiving the services will be deemed a joint employer under the NLRA. Companies entering into these relationships should carefully weigh the benefits of control against the risk of being deemed to be a joint employer and reflect their desired balance in their contract, practice and procedures.
As fall approaches and students head back to school, The Employment Lawyers are taking a look back and a look ahead at issues in labor and employment law. Join us for an informational webinar to review developments over the past year and discuss tips to keep your workplace practices current in the coming year.
Thursday, September 17, 2015
12:00 pm – 1:30 pm (CDT)
CLICK HERE TO REGISTER
- Proposed changes to overtime regulations that will make more employees overtime-eligible
- New standards in accommodating religious practices and pregnancy
- The NLRB’s “quickie” election rules and what they mean for union organizing efforts
- Raising the standard to establish that a worker is properly classified as an independent contractor
- The EEOC’s new position on wellness programs and disability discrimination
- Expanding employee retaliation and whistleblower claims
- New state and local laws that impact minimum wage, paid sick leave and accommodation requirements
CLE Credit Available | This program has been submitted to the HR Certification Institute for review.
Contact Annie Darmofal at 312.476.7626 or firstname.lastname@example.org
Private Illinois employers may now give preference to veterans in their hiring practices.
Governor Bruce Rauner has signed the Veterans Preference in Private Employment Act, which allows private employers to voluntarily implement hiring policies that give preference to individuals who have served in the military, whether on active or reserve duty, including the Illinois National Guard.
Employers wanting to take advantage of this new law will need to have a written policy and reference it on job applications. The policy must also be publicly displayed in the employer’s workplace or on the employer’s website.
The EEOC has confirmed its position that Title VII prohibits discrimination against employees based on sexual orientation. The EEOC’s statement followed on its prior determination that Title VII protects individuals against discrimination based on transgender status, gender identity, and an employee’s transitioning between genders. According to the EEOC, sexual orientation bias is “associational discrimination on the basis of sex.” Thus, employees who work for an employer with 15 or more employees can file a charge of sex discrimination with the EEOC if the employee has been discriminated against because of sexual orientation or gender identity or expression.
Notwithstanding the EEOC’s position, there is still no federal law that explicitly protects individuals from employment discrimination based on sexual orientation and gender identity. However, 22 states (including Illinois), Washington, D.C., and Puerto Rico, have state-based employment nondiscrimination laws that cover sexual orientation and/or gender identity that apply to both private and public sector employers.
With so much recent attention, employers should be particularly attentive to issues relating to sexual orientation and gender identity. We suggest updating any employment policies and practices to include prohibitions on discrimination and harassment based on sexual orientation and gender identity to help protect employers against EEOC and state-law challenges.
A challenge to the NLRB’s “ambush election rules” has failed. A federal court sitting in the District of Columbia ruled that the U.S. Chamber of Commerce and other business groups challenging the new election rules – which, as discussed in our prior blog post, speed up the union election process – failed to prove that the rules violate any laws. The court rejected the groups’ contentions that the rules constitute “sweeping changes to the election process” and impinge on employers’ constitutional rights.
With the new rules seemingly here to stay, employers need to be prepared and ready to go.