On June 5, National Labor Relations Board (NLRB) Chairman John Ring announced that the NLRB will conduct notice-and-comment rulemaking to define a workable joint-employer standard under the National Labor Relations Act.
Prior to 2015, an entity would be determined a joint employer of another entity’s employees, and thus liable for labor law violations, only if they exercised “direct control” over the employees. This was a clear and dependable test. However, in 2015, the NLRB upended 30 years of labor law, in Browning-Ferris Industries (BFI), redefining joint-employer status on a case-by-case basis to determine whether an entity has the potential to or does exercise indirect control over the conditions and terms of employment of another company’s employees.
Today, manufacturers who exercise little to no control over a subcontractor’s employees are exposed to unmeasurable risk. The result of BFI has exponential effects as many manufacturers often contract with more than one company to perform various services (e.g., on-site cleaning, maintenance or food services). Employers have struggled to apply the Board’s BFI decision to predict their responsibilities and liabilities with regard to these services’ employees, outside of their control, all because of one bad decision from the NLRB.
Since BFI, the National Association of Manufacturers (NAM) has worked tirelessly to make the case for a more workable standard, both in the courts and Congress. This week, the NAM joined a group of other industry associations in filing a petition for rulemaking with the NLRB.
The NAM applauds the NLRB for taking this step, and we will continue to fight for a workable, dependable and stable joint standard for the manufacturing industry throughout the rulemaking process.