The standard for joint employer status has been long contested by the NLRB, impacting franchisor and franchisee relations. On May 9th, the NLRB released a press release to address the current standstill on the joint-employer standard. Considering the back and forth shift that this issue has experienced, the NLRB has resolved to try establishing the standard through congressional rulemaking.
This conflict began in 2015 with the Board’s decision in Browning-Ferris Industries, 362 NLRB No. 186 (2015) (“Browning-Ferris”). The Browning-Ferris decision expanded the standard for joint employer status, establishing a standard that favors unions and employees. A big win for workers, this decision increased accountability for wages and working conditions on the employer’s part. The Board also gave workers bargaining power to negotiate working conditions with employers, according to the American Federation of Labor Congress of Industrial Organizations (AFL-CIO).
In a recent decision in Hy-Brand Industrial Contractors, Ltd., 365 NLRB No. 156 (2017) (“Hy-Brand”), the Board found that Browning-Ferris exceeded the NLRB’s statutory authority. The resulting test for joint-employer status returned to an employer-friendly standard.
The decision in Hy-brand, however, was vacated in February 2018 due to conflicts of interest with Board Member William Emanuel. The NLRB has since reverted to the Browning-Ferris standard, to the dismay of franchise owners.
The board has begun to consider the rulemaking route to establish the joint-employer standard under the NLRA, according to the press release. While a decision has not yet been made, NLRB Chairman John F. Ring writes that the Board is working to resolve the issue as quickly as possible.
“Whether one business is the joint employer of another business’s employees is one of the most critical issues in labor law today,” said NLRB Chairman John F. Ring in the press release. “I am committed to working with my colleagues to issue a proposed rule as soon as possible, and I look forward to hearing from all interested parties on this important issue that affects millions of Americans in virtually every sector of the economy.”