NLRB joint-employer rule disputes
e National Labor Relations Board (NLRB) governs collective bargaining rights and unfair labor practices under the National Labor Relations Act (NLRA). The joint-employer doctrine is crucial in determining when two or more entities share responsibility for employees’ labor rights. This is particularly important in franchising, subcontracting, staffing agencies, and complex corporate structures.
Why Joint-Employer Status Matters?
Collective bargaining: Identifying all joint employers expands the bargaining unit and liability.
Unfair labor practices: All joint employers can be held responsible.
Scope of employment law protections: Joint employers may be liable for wage, hour, and safety standards.
Evolution of the Joint-Employer Doctrine
The joint-employer standard has shifted over decades, reflecting changes in labor market practices and political administrations.
Traditional test: Focused on whether employers exercised direct and immediate control over employees.
Broadened test (2015 Obama-era): Included indirect control and potential control even if not exercised.
Narrowed test (2017 Trump-era): Returned focus to actual, direct control.
Key Cases and NLRB Decisions
Case 1: Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 (2015)
Background: Browning-Ferris used a staffing agency to supply workers but did not directly control daily work details.
Issue: Whether Browning-Ferris was a joint employer of the staffing agency workers.
Ruling: The NLRB broadened the joint-employer standard to include companies that have indirect or potential control over workers, even if not exercised.
Significance: This was a landmark expansion; indirect control, reserved rights, and even potential control sufficed for joint-employer status.
Impact: Greatly increased the number of joint-employer findings, affecting franchising and subcontracting industries.
Takeaway: Expanded joint-employer liability to entities with reserved or indirect control.
Case 2: Hy-Brand Industrial Contractors, Ltd., 365 NLRB No. 156 (2017)
Background: After Browning-Ferris, Hy-Brand challenged its joint-employer status.
Issue: Whether the expanded joint-employer standard applied.
Ruling: NLRB reaffirmed Browning-Ferris but clarified nuances about reserved vs. exercised control.
Significance: Supported the broad standard emphasizing potential control.
Takeaway: Reinforced the expanded scope from Browning-Ferris.
Case 3: TLI, Inc., 367 NLRB No. 87 (2019)
Background: Under the Trump-era Board, TLI was accused of joint employer status for workers supplied by a staffing agency.
Issue: Whether indirect or potential control was sufficient to establish joint-employer status.
Ruling: The NLRB narrowed the test, requiring actual, direct, and immediate control over essential employment terms.
Significance: Reversed Browning-Ferris standard, focusing on exercised control, not potential.
Impact: Reduced the scope of joint-employer liability, favored businesses against claims involving subcontractors or franchisees.
Takeaway: Emphasized direct control as threshold for joint-employer status.
Case 4: McDonald’s USA, LLC, 368 NLRB No. 25 (2019)
Background: Workers argued McDonald’s was joint employer with franchisees.
Issue: Application of the joint-employer test to franchising.
Ruling: Applying the TLI standard, the Board found no joint employer relationship because McDonald’s did not exercise direct control over franchise employees.
Significance: Major victory for franchisors; limited their joint liability.
Takeaway: Clarified that reserved rights alone do not establish joint-employer status.
Case 5: Bojangles’ Restaurants, LLC, 370 NLRB No. 52 (2021)
Background: Challenge to Browning-Ferris expanded test reinstatement.
Issue: Whether to continue with TLI’s narrowed test or revert to Browning-Ferris.
Ruling: The Biden-appointed NLRB returned to the broader Browning-Ferris standard, reinstating potential and indirect control as factors.
Significance: Signaled return to broader joint-employer liability under the current administration.
Takeaway: Ongoing fluctuations in doctrine depending on political changes.
Case 6: Superior Staffing Services, Inc. v. NLRB, 832 F.3d 899 (8th Cir. 2016)
Context: Judicial review of joint-employer findings.
Issue: Whether NLRB’s broad definition is lawful.
Holding: The Eighth Circuit upheld the broad standard set by Browning-Ferris.
Significance: Federal courts can uphold NLRB’s expanded joint-employer interpretations.
Takeaway: Courts often defer to NLRB’s interpretation unless unreasonable.
Case 7: NLRB v. Browning-Ferris Industries of Pennsylvania, 691 F.2d 1117 (3d Cir. 1982)
Background: Earlier precedent involving Browning-Ferris, foundational for joint-employer analysis.
Issue: Scope of employer control required for joint employer status.
Holding: The Third Circuit articulated the traditional focus on actual control.
Significance: Earlier framework that was later expanded in 2015.
Takeaway: Established baseline principles later broadened and narrowed.
Summary Table of Joint-Employer NLRB Decisions
| Case Name | Year | Board/Court | Joint-Employer Test Applied | Impact |
|---|---|---|---|---|
| Browning-Ferris Industries | 2015 | NLRB (Obama) | Broad, includes indirect/potential control | Expanded joint-employer liability |
| Hy-Brand Industrial Contractors | 2017 | NLRB | Reaffirmed Browning-Ferris | Reinforced expanded test |
| TLI, Inc. | 2019 | NLRB (Trump) | Narrowed to actual, direct control | Reduced scope of joint-employer liability |
| McDonald’s USA, LLC | 2019 | NLRB (Trump) | Applied TLI test, no joint employer | Limited franchisor liability |
| Bojangles’ Restaurants, LLC | 2021 | NLRB (Biden) | Returned to Browning-Ferris broad test | Re-expanded joint-employer liability |
| Superior Staffing Services v. NLRB | 2016 | 8th Circuit Court | Upheld Browning-Ferris broad standard | Courts often defer to NLRB interpretations |
| NLRB v. Browning-Ferris (3d Cir.) | 1982 | 3rd Circuit Court | Traditional actual control test | Original test, later modified |
Conclusion
The joint-employer rule disputes have been a battleground between expanding and narrowing the definition of joint employer.
The Obama-era NLRB expanded joint-employer liability to include indirect and potential control.
The Trump-era NLRB reversed course, limiting joint-employer status to actual exercised control.
The current (Biden-era) NLRB has moved back toward the broader standard.
Courts often defer to NLRB’s interpretations unless they are arbitrary or capricious.
The fluctuating standards impact franchising, staffing, subcontracting, and labor organizing efforts significantly.
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