NLRB Proposes Change to Joint Employer Standard

On Sep. 13, 2018, the National Labor Relations Board (NLRB) issued a press release about the Board proposing a rule change to its joint employer standard. In the release, it stated that on Sep. 14, the NLRB would be publishing a Notice of Proposed Rulemaking in the Federal Register regarding the NLRB’s joint employer standard.

“Under the proposed rule, an employer may be found to be a joint-employer of another employer’s employees only if it possesses and exercises substantial, direct and immediate control over the essential terms and conditions of employment and has done so in a manner that is not limited and routine. Indirect influence and contractual reservations of authority would no longer be sufficient to establish a joint-employer relationship,” according to the NLRB.

Essentially, this proposal reflects the majority of the Board members' view on the topic. The Board is leaving the subject open to discussion and is taking public comments, which could result in a revision of its proposal. The intention of the National Labor Relations Act is well-supported by a joint-labor doctrine, which does not involve third parties who do not play a critical role in the deciding of employee benefits and wages, and other terms and conditions of the employees’ employment relationship.

When Board Chairman John F. Ring announced the proposal, he said that he looks forward to receiving the public’s comments and working with his colleagues to promote a final rule that would clarify the joint employer standard in a way that not only advances the purposes of the Act, but promotes “meaningful collective bargaining.” Mr. Ring was joined by fellow board members, Marvin E. Kaplan and William J. Emanuel, but Board Member Lauren McFerran was not supportive of the proposed rule change.

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