Wyatt Employment Law Report


NLRB Returns to Traditional Common-Law Test For Independent Contractors

By Michelle D. Wyrick

On January 25, 2019, in SuperShuttle DFW, Inc. and Amalgamated Transit Union Local 1338, Case 16–RC–010963, the National Labor Relations Board (“NLRB”) overruled its prior decision in FedEx Home Delivery, 361 NLRB 610 (2014), and returned to the common-law test that it previously used to determine whether workers were employees or independent contractors.  The NLRB’s decision clarifies the role that “entrepreneurial opportunity” plays in deciding whether workers are employees or independent contractors.  The significance is that employees can unionize under the National Labor Relations Act (“NLRA”).  Independent contractors cannot.

bus-people-public-transportation-34171

The NLRB criticized the FedEx decision because it “significantly limited the importance of entrepreneurial opportunity.”  In SuperShuttle, the NLRB considered whether franchisees who operated shared-ride vans for SuperShuttle Dallas-Fort Worth were employees covered under the NLRA or independent contractors.  The franchisees were required to purchase or lease their own vans (that met franchise specifications), and they paid SuperShuttle Dallas-Fort Worth a franchise fee and a flat weekly fee for the right to use the SuperShuttle brand and its reservation apparatus.  Franchisees paid for their own gas and van maintenance.  The franchisees were not Continue reading


With New NLRB Proposed Rule, Browning-Ferris’s Days May Be Numbered

By Thomas E. Travis

The National Labor Relations Board (“NLRB”) recently proposed a new rule to scale back a controversial Board decision from 2015 regarding the appropriate test for whether a franchisor and franchisees are “joint employers” under the National Labor Relations Act. This would directly roll back the NLRB decision in Browning-Ferris Industries of California, where the Board extended joint employment to circumstances where a company has only “indirect” control over another company’s workers, overturning a prior ruling that required “direct and immediate control.”

The new proposed rule would establish that two entities become joint employers “only if the two employers share or codetermine the employee’s essential terms and conditions of employment, such as hiring, firing, discipline, supervision, and direction.” This is, of course, much closer to the original “direct and immediate control” standard, with even more ascertainable guidelines to assist the Board in reaching its determination. And contra Browning-Ferris, this standard is much more difficult for challengers to meet in making claims for joint employment.

Should the proposed rule take effect, commenters are somewhat divided over the impact of Browning-Ferris on litigation. Some observers note that the standard was infrequently invoked and seemed to not impact labor litigation nearly as much as its detractors contend. On the other hand, some critics rebut that the impact is felt not just in litigation, but in business planning and economic development: the broad standard invoked in Browning-Ferris required entities to closely evaluate every workplace scenario in attempt to avoid the vague strictures of the NLRB’s decision, and the prior rule seems to disincentivize franchising and other cost-saving business relationships.

Employers will most likely welcome the proposed change. If anything, the proposed change removes the latent ambiguities from Browning-Ferris, and replaces it with a clear standard to ease future business planning going forward.


Employers Have Opportunity to Comment on NLRB’s Proposed Joint Employer Rule

By Sharon Gold

The National Labor Relations Board (“NLRB”) recently proposed a rule establishing the standard for determining joint employer status under the National Labor Relations Act.  Employers have until November 13, 2018 to comment about the proposed rule.  The proposed rule, commentary and instructions on commenting are available here.

There have been several changes to the definition over the past few years, which has caused uncertainty for employers.  The proposed rule states that employers are joint employers “only if the two employers share or codetermine the employees’ essential terms and conditions of employment, such as hiring, firing, discipline, supervision, and direction.”  Proposed Rule Part 103.40.  “A putative joint employer must possess and Continue reading


Leave a comment

NLRB establishes new policy governing employee handbooks and workplace policies

By Mitzi Wyrick

In Boeing Co., 365 NLRB No. 154, the National Labor Relations Board (“NLRB”) overturned the standard established in Lutheran Heritage Village-Livonia, 343 NLRB No. 646 (2004) for weighing the legality of employee handbook rules and workplace policies.  In Lutheran Heritage Village-Livonia, the NLRB created confusion for employers when it ruled that employers violated the National Labor Relations Act (“NLRA”) by maintaining workplace rules that did not explicitly prohibit protected activities, were not adopted in response to such activities and were not applied to restrict such activities, if the rules would be “reasonably construed” by an employee to prohibit the exercise of Section 7 rights under the NLRA.

Under Lutheran Heritage, employers were found to have violated the NLRA for having seemingly innocuous policies prohibiting “loud, abusive or foul language,” rules subjecting employees to discipline for an “inability or unwillingness to work harmoniously with other employees,” and rules prohibiting “negative energy or attitudes.”  Confusingly, under Lutheran Heritage, some rules Continue reading


Leave a comment

NLRB Overrules Specialty Healthcare and Eliminates Overwhelming Community of Interest Standard

By Mitzi Wyrick

In PCC Structurals, Inc., 365 NLRB No. 160, the National Labor Relations Board (“NLRB”) clarified the correct standard for determining whether a proposed bargaining unit constitutes an appropriate unit for bargaining when the employer contends that the smallest appropriate unit must include additional employees.  The NLRB overruled Specialty Healthcare & Rehabilitation Center of Mobile, 357 NLRB No. 934 (2011) (Specialty Healthcare) and reinstated the traditional community-of-interest standard for determining an appropriate bargaining unit in union representation cases.

Under Specialty Healthcare, if a union petitioned for an election among a particular group of employees, those employees shared a community of interest among themselves and the employer took the position that the smallest appropriate unit had to include employees excluded from the proposed unit, the NLRB would not Continue reading


Leave a comment

NLRB Reverts to Prior Standard for Implementing Unilateral Changes

By Mitzi Wyrick

In Raytheon Network Centric Systems, 365 NLRB No. 161, the National Labor Relations Board (“NLRB”) issued a ruling affecting bargaining obligations that are required before implementing a unilateral “change” in employment matters. Until 2016, when the NLRB decided E.I. du Pont de Nemours, 364 NLRB No. 113, the NLRB had found that an employer was not obligated to bargain before making unilateral changes when it followed a well-established past practice.

In the 2016 DuPont decision, the NLRB held that even if an employer acted consistently with past practice, if a collective bargaining agreement  (“CBA”) had expired and was no longer in effect, bargaining would always be required.  Specifically, the NLRB had required the employer to Continue reading


Leave a comment

Emanuel Fills Last NLRB Seat

By Edwin S. Hopson

On September 26, 2017, William J. Emanuel, a Republican,  was sworn in as a Member of the National Labor Relations Board.  Emanuel’s term will end August 27, 2021. The Senate had confirmed his nomination by a vote of 49-47 after Democrats filibustered his appointment.

Prior to his appointment, Emanuel was a shareholder with Littler Mendelson, P.C., a law firm representing management in labor and employment matters.  He had also practiced labor law with several other firms.

With this new Member, the NLRB is once again at full strength – three Republicans and two Democrats.