On August 27, 2015, in Browning-Ferris Industries of California, Inc. d/b/a BFI Newby Island Recyclery (Browning-Ferris), 362 NLRB No. 186 (2015), the National Labor Relations Board established a new legal standard for determining whether two employers are joint employers under the National Labor Relations Act.
The Browning-Ferris standard:
The Board may find that two or more entities are joint employers of a single work force if they are both employers within the meaning of the common law, and if they share or codetermine those matters governing the essential terms and conditions of employment. In evaluating the allocation and exercise of control in the workplace, the Board will consider the various ways in which joint employers may "share" control over terms and conditions of employment or "codetermine" them, as the Board and the courts have done in the past.
Essential terms and conditions of employment include firing, discipline, supervision, and direction, as well as wages and hours, as reflected in the Act itself. Other examples of control over mandatory terms and conditions of employment found probative by the Board include dictating the number of workers to be supplied; controlling scheduling, seniority, and overtime; and assigning work and determining the manner and method of work performance.
The common-law concept of control informs the Board's joint-employer standard. But the Board will no longer require that a joint employer not only possess the authority to control employees' terms and conditions of employment, but must also exercise that authority, and do so directly, immediately, and not in a "limited and routine" manner. The right to control, in the common-law sense, is probative of joint-employer status, as is the actual exercise of control, whether direct or indirect.
The existence, extent, and object of a putative joint employer's control, of course, all may present material issues. For example, it is certainly possible that in a particular case, a putative joint employer's control might extend only to terms and conditions of employment too limited in scope or significance to permit meaningful collective bargaining. Moreover, as a rule, a joint employer will be required to bargain only with respect to such terms and conditions which it possesses the authority to control.
Temporary Overruling of Browning-Ferris - "Hy-Brand I"
On December 14, 2017, in Hy-Brand Industrial Contractors, Ltd. and Brandt Construction Co., the NLRB overruled Browning-Ferris, finding it a distortion of common law as interpreted by the Board and the courts, contrary to the NLRA, ill-advised as a matter of policy, and its application would prevent the Board from discharging one of its primary responsibilities under the Act, which is to foster stability in labor-management relations.
February 26, 2018 Vacatur of Hy-Brand I
This month, the NLRB denied the reconsideration of its February 26, 2018 Decision which vacated Hy-Brand I.
Thus, the Browning-Ferris standard remains the applicable legal standard for joint-employer analysis under the NLRA.