NLRB Restores Browning-Ferris Standard for Joint Employment

Author: Michael Cardman, XpertHR Legal Editor

February 27, 2018

The National Labor Relations Board (NLRB) has returned to a more expansive standard for determining whether two or more employers are joint employers under federal labor law - and thereby jointly liable for any violations and jointly subject to collective bargaining.

Under this standard - first put forth in the NLRB's 2015 Browning-Ferris decision - employers can be considered to be joint employers under the National Labor Relations Act (NLRA) even if they exercise only indirect control of shared employees or reserve the right to control shared employees.

Late last year, Republican members of the NLRB had taken advantage of a narrow window during which they held a 3-2 majority to issue the Hy-Brand Industrial Contractors decision that overturned Browning-Ferris and restored a decades-old standard under which an employer must, among other things, exercise "direct and immediate" control over shared employees to be considered a joint employer. The business community welcomed Hy-Brand as "a much-needed dose of predictability into planning their third-party business relationships."

But on February 9, the NLRB's inspector general said that one of the board's Republican members, William Emmanuel, should have been disqualified from taking part in Hy-Brand because his law firm had represented one of the parties in the Browning-Ferris decision. This opened the door for a three-member panel comprising two Democrats and one Republican to vacate Hy-Brand, thereby restoring the Browning-Ferris decision.

As a result of this development, some business groups called on Congress to pass a bill that would narrow the definition of joint employment. This bill has passed the House but still awaits a vote in the Senate.