The National Labor Relations Board spent some time in the limelight this August after issuing decisions in two high-profile cases with major implications for labor rights across the country. In Browning-Ferris Industries of California, the Board broadened the “joint-employer” doctrine, making it easier for unions to get corporations to the bargaining table. In Northwestern University, the Board declined to exercise jurisdiction over college football players’ efforts to be declared employees with the right to unionize under the National Labor Relations Act (“NLRA”).
NLRB Imparts a New Joint-Employer Doctrine
On August 27, the NLRB released a much-anticipated decision in a case involving several hundred sorters, screen cleaners, and housekeepers who work at a recycling facility owned by Browning-Ferris Industries of California (“BFI”). BFI subcontracted with Leadpoint Business Services to provide these workers, while it also directly employed about 60 other employees primarily responsible for moving materials outside of the facility and preparing them to be sorted. The Sanitary Truck Drivers and Helpers Local 350 union (a Teamsters affiliate) petitioned for an NLRB-election to represent the Leadpoint-provided employees. When an administrative law judge ruled that Leadpoint was the “sole employer,” the union appealed to the NLRB. Preferring to bargain with BFI, the union argued that the Board should broaden its “joint-employer” standard and find that BFI and Leadpoint jointly employ the employees in question. As a joint-employer, BFI would be required to bargain with the Union and would be liable for unfair labor practices committed against the affected employees.
In a 3-2 decision, the Board agreed with the union. It concluded that the previous “joint employer” standard “significantly and unjustifiably narrow[ed] the circumstances where a joint-employment relationship can be found . . . .” The NLRB stated:
The Board’s joint-employment jurisprudence [is] increasingly out of step with changing economic circumstances, particularly the recent dramatic growth in contingent employment relationships. This disconnect potentially undermines the core protections of the [NLRA] for the employees impacted by these economic changes.
Thus, the Board chose to impose a broader joint-employer criteria. Under this standard, the Board will no longer require that an employer exercise “direct” and “actual” control over employees to be considered a joint employer. Rather, the test will be satisfied even where a corporation simply has indirect control and a right to control the workers.
In applying the new standard to BFI, the Board found that a variety of factors – including BFI’s contractual right to set certain hiring, firing, and discipline guidelines, its ability to exercise control over shift schedules and supervision, and its contractual imposition of a wage ceiling for the employees – was sufficient to conclude that it was a joint employer with Leadpoint.
The decision may greatly expand the rights of individuals employed by subcontractors, franchisees, and temp agencies. Most imminently, the ruling will likely affect a series of cases involving employees’ attempts to hold fast food companies accountable as a joint employers with their franchisees. Big business will likely challenge the BFI decision, but in the meantime it has garnered a lot of national media attention and appears to be a big win for unions around the country.
NLRB Refuses to Assert Jurisdiction Over Northwestern Football Team’s Effort to Unionize
In January 2014, scholarship members of the Northwestern University football team sought to unionize by filing a petition with the NLRB. The players’ efforts were particularly noteworthy because a successful union campaign would fundamentally change the relationship between college athletes, universities, and the NCAA. For some time, things looked good for the student-athletes’ case. Earlier this month, however, the Board poured cold water on the unionization effort.
In a somewhat surprising 5-0 ruling, the NLRB declined to assert jurisdiction over the matter. The Board reasoned that a decision on the merits of the case would “not promote stability in labor relations.” It expressed particular concern that a favorable ruling for the players would be binding on only 17 of the roughly 125 football schools, because the others are state-run institutions, which are subject to state – not federal – labor laws. The NLRB stated:
Some states, of course, permit collective bargaining by public employees, but others limit or prohibit such bargaining. At least two states—which, between them, operate three universities that are members of the Big Ten—specify by statute that scholarship athletes at state schools are not employees. Under these circumstances, there is an inherent asymmetry of the labor relations regulatory regimes applicable to individual teams. In other contexts, the Board’s assertion of jurisdiction helps promote uniformity and stability, but in this case, asserting jurisdiction would not have that effect because the Board cannot regulate most FBS teams.
Although the Board technically left the door open for future unionization efforts by student-athletes, the once promising case of the Northwestern football players has hit a seemingly insurmountable roadblock.